Battsog Khurlee, Xac Bank - Amar the Mobile Banking Service

The MOBILE BANKING SERVICE for Modern nomads of the Steppe

History of AMAR

o Selected one of the selected 9 out of 70 participant from 38 countries

o To extend the banking service to those who are unbanked and have no access to financial services

o To decrease the cost of banking services compared to traditional banking channels

Launched on 2th July, 2009

What AMAR offers?

o BANK BASED MOBILE BANKING• XacBank – over 10 years of history in banking sector • No virtual or e-money involved. Only real bank accounts

o SIMPLE AND INTERFACE INDEPENDENT• SMS based service simplifies the tech base. No need for

specialized phone• Menu application for all 4 different operating system.

o CHEAP AND FLEXIBLE• A lot cheaper alternative for user comparing to other means of

banking channels • All basic banking services included• Service types can be added or modified anytime• Cash transactions available through agent network

o 24/7 SERVICEo SECURE THROUGH INNOVATIVE LOGICAL IDEAS

Advantages of AMAR

АМАR#

What is the status of AMAR now?

XacBank

123,000Client base 450,000

21,0 million Outstanding balance /usd/ 275,7 million

845Cash agent* 97 branches+91 ATM’s

1,108 Merchants** 800 POS

50,000Monthly transaction # 350,000

3-3,5 millionMonthly transaction amount /usd/ 340 million

70-80 thousandMonthly inquiry service

-

* A place, where AMAR client can withdraw or deposit a cash

** A place, where AMAR client can pay for purchase or service

A tool to lower operational cost• 50,000 transactions per month• 70-80 thousand enquiry for information per

month

A way to increase client base • 120,000 registered clients

Deposit • Transaction amount is 3-3,5 million usd per month

Customer service

• Cheap • Easy • Secure

Only way to provide service to unreachable places • If there is network coverage - it works

The benefits AMAR brings to XacBank

o LACK OF PROPER LEGALIZATION REGARDING:• E-Signature• E- Finance

o “ZERO” EXPERIENCE IN BUILDING AGENT NETWORK• Vast country with low population• High cost of operation

o CUSTOMER ADAPTION • Public trust and awareness of advantages of mobile banking• High cost of marketing • Low percentage of active users

o COOPERATION WITH MNO’S:• Different terms and conditions, policy• Poor technical capability• Competition from operators

What were challenges?

I stage II stage

Current

• Quality • Ecosystem

• Few agents • Agents- cash

withdrawal only

• As many agents as possible

Agent network

PROS

• Biggest network ever • Good participation of

branch staff;• Expensive

• Easy to maintain and train;

• Less expensive;

• Increase in number of transaction & amount;

CONS

• Large numbers of non active;

• Expensive to maintain;

• Conflict with an agents-Cash deposit;

• Hard to convince big companies to join;

• Still cash society ;

POINTS: o AMAR+ POSo Dedicated team to take care of both agents &

wholesalerso Cross sale & upsale to all parties

• Internet banking • Credit line/ loan• Others AMAR clients

Purchase &

Cash withdrawal

Wholesale payment

Agents Wholesalers

Goo

ds

GoodsC

ash

AMAR ecosystem

• Focused to introduce the service• Brand creation • Customer base• Agent network

Stage I:

• Focused to make it common use • Usage based marketing activity • AMAR+ other banking service, product • Development to make more user friendly

Stage II:

• Focused to extend• Partnership with strategically important

companies• Loyalty program

Stage III:

Marketing strategy

EXPENSIVE

EFFECTIVE

EFFORT NEEDED

What we are doing to increase a usage?

o MARKETING CAMPAIGNS THROUGHOUT THE COUNTRY• On site training for large groups - small incentive for active participants• Usage based promotional activity

o DIRECT APPROACH TO EXISTING non AMAR BANK CLIENTS • From branch & Call Center• Direct SMS & Email

o DEVELOPMENT&IMPROVEMENT SYSTEM• Enable clients to use AMAR for their bill payment easily• Registration from distance

o NEW POLICY TO PUSH CLIENTS TO USE E-CHANNEL • Fee introduction for small amount of transaction at Bank

o AMAR REBRANDING:• AMAR- it is an E-Banking service, not only mobile phone banking

o SOFTWARE DEVELOPMENT• From SMS based to WAP based service• NFC or other necessary technology

o START MAKING REVENUE FROM THE SERVICE:• Payment collection fee from utility companies• Entrance fee from clients

o AGENTS/Reconsideration of AGENT POLICY/:• ATM for cash withdrawal • Agents for cash deposits and payment collection

Plan for future

Online Banking

THANK YOU FOR YOUR ATTENTION