As digital banking services gain precedence, banks are further pushing their services towards the previously unbanked and underprivileged people in rural and remote locations. The penetration of mobile phones, smartphone apps, and digital assets is facilitating the digital financial channels to scale up quickly. The global market for digital banking is expected to reach US$30.1 billion by 2026, advancing at a CAGR of 15.7 % amid the pandemic chaos. Owing to the steadily increasing potential of digital banking and the ongoing digitalization of the agent network, the world has witnessed significant process optimization in recent years. An agent only needs a smartphone and a mobile app to deliver a variety of banking and financial services, even in metropolitan or rural locations.
Digital banking solutions are filling the void, providing financial services to millions of unbanked people. More individuals from diverse phases of the spectrum are using agency banking services through digital banking platforms. In the post-pandemic era, governments across the globe use agency banking to allocate funds for pensions and extend assistance in remote and rural areas. Banks use it to drive large-scale transactions and capture customer data to frame innovative business services.
The Agency Banking concept is not a new phenomenon in the banking industry and has helped in supporting several economies in the past by enabling customer onboarding through cash in/cash out, remittances, bill payments, pre-approved micro-loans, and micro-insurance across diverse customer groups. Isolated networks are a distant memory now as visionary and tech-savvy industry experts realize this fact. The market is switching towards a platformed-approach which helps reach consumers where they can build relationships, while gradually transitioning them towards alternative digital platforms.
Let's take a look at what innovations are expected ahead in 2022 for agency banking services.
Seamless Compliance Processes
In remote towns, agents frequently perform the duty of bank customer service. Their assistance is particularly valuable when it comes to regulatory compliance processes. Amid concerns about organized frauds and security, almost all countries across the globe scrutinize the banking sector. In order to counter fraud, measures like the eKYC are important. Many customers are dissatisfied with the lengthy manual document authentication and onboarding processes. In these circumstances, subscribing to a basic banking service can take days.
Many banks, however, have struggled to automate some mandatory compliances due to technical constraints. The integration of customer onboarding and customer verification in a short timeframe will therefore be expected to optimize the performance of last-mile services. Accessing financial services in the coming future will be a faster and seamless digital process facilitated by an agent. The consumer's choice will be influenced primarily by the timeliness and customer experience. As a result, the bank must be concerned not only about the consumer experience but also about the agent's ability to deliver.
Diverse Agent Network
The benefits of Agency Banking are already recognized by banks. However, no player can afford to create and sustain an exclusive agency banking network. As a result, inviting and enrolling multi-brand agents is a widespread practice. These individuals are primarily marketplace agents or traders who offer services from a variety of financial institutions. Even though an agent and a merchant are very different, they both generate revenue via commissions. Often, the agent only provides banking or telecom services, while the merchant is a sales representative who runs a business and uses it to market financial or telecom services.
Looking at the present banking ecosystem, banks with seamless digital processes and faster onboarding will have an edge over other players. Digitalized banking processes enable its agents to deliver a better customer experience. The trend is to enhance the engagement with the agents more consistently. The agency banking solution will provide additional and advanced CRM tools to strengthen the relationship with agents so that they will recommend one bank's service over competitors to the customers.
Multiple Services in a Single Platform
An agent can provide services on behalf of many banks. Banks offer additional forms of external services, such as utility payments, payment for third-party services, local government services, and so on. These multiple services on a single platform, with the ability to add new features without the need for additional hardware or software, are convenient for agents.
As a result, agents will almost always choose to recommend and push customers towards the bank that provides this solution. These multi-service apps enable banks to broaden their offerings through easy and quick integrations. The future of agency banking is undeniably flexible. This approach is based on a marketplace mechanism, where any form of third-party service integration is available. The objective is to optimize resources while increasing revenue streams per agent.
Preparing for the Future with Panamax Agency Banking Solution
Majority of the banks are aware of the upcoming obstacles in the industry. Any error of judgment is costly for them because outdated and non-versatile solutions are incapable of adapting to changing trends and become obsolete soon.
Panamax's Agency Banking Solution empowers banks and financial institutions to reduce their infrastructure costs by establishing a diverse agent network to deliver services for rural and unbanked populations. This platform delivers multiple services such as cash management, marketing, branding, operational services, as well as license and regulatory compliance. With business scalability at the center, our solution facilitates multiple agent registrations along with a user-friendly interface.
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