The Practice Of International Branchless Banking And Its Enlightenment To China

The lack of financial inclusion in remote areas such as ruralareas is a common problem in developing countries. Nowadays, financial institutions such as bank in more and more countries are actively exploring a new way of business or ways to provide service for those who cannot reach the financial services.In the1970s to90s, many developing countries in the world is mainly rely on state-owned banks, commercial banks and their branches to provide various financial services to people. But with the continuous development of the society and the improving financialization, people’s demand for financial services increases dramatically, through the bank and its branches to satisfy people’s demand for financial services become more and moreunavailable, especially in remote mountainous areas and the rural areas where economy is relatively backward. Thus, there are many villages and towns that cannot reach any financial services. In order to satisfy people’s needs, and make up the long-standing financial gap in these areas, the government begins to publish relevant policy to support banks and other financial institutions to provide basic financial services to people in these areas in ways that is different from traditional financial services, and branchless banking is born in the background.In this paper, the second chapter first introduces the basic concept, characteristics, structure, operation mechanism, business functions and service mode of branchless banking, and extends its inner meaning:the. social commitment of providing financial services for the poor, and improving their lives and the financial commitment of achieving sustainable development. The target that branchless banking wants to realize is to find a balance between them. Second, from the perspective of customer demand, agent network, service mode and risk management this paper discusses the experiences and lessons of international branchless banking practice. In the aspect of customer demand,the productandservice that branchless banking provides should be based on customer demand, and achieve the target of know you customer;in the aspect of agent network,through the agent network, branchless banking provides financial services to a large number of poor people with low cost; in the aspect of service mode,as the specific situation of each country’s is not the same, so selecting ofbranchless banking service mode should be based on the reality of the country’s economic and social background; in the aspect of risk management,as a kind of financial service innovation, branchless bankingaims to solve the availability of financial services of the poor, improve the financial coverage, but at the same time, it also brings many new risks, if there is no matching risk management regulation, which may damage the interests of customers, and even affect the safety of the whole financial system.The third chapter introduces the successful practice of Brazil, India, the Philippines, and Kenya. And then analysis the similarities and differences between them. The first same points between the four country is that they all rely on the information and communication technology, and the second point is that they all use agents. The first difference is that Brazil and India are less dependent on mobile phone technology, the main business application of them are card reader technology;the second is that Brazil and India provide the bank account to deposit funds which absorb from customer, whichbelongs to the bank supervision system, but Philippinesand Kenya deposit funds which absorb from customer in the accounts that mobile operators provide and which are not governed by the banking system. The main reason of the differences is the background of carrying out of this practice. Brazilian branchless banking practice is under the government’s strong support and promotion, and India starts this practice with cooperation of government agencies, but in Kenya and the Philippines, branchless banking practice is introduced in a relatively fuzzy policy environment,the attitude of regulatory authorities to branchless banking is not clear.The fourth chapter mainly analysis the basic principles of constructing our branchless banking from the following several aspects.Firstly,the tenet of branchless banking practice in China should be in order to solve the problem of financial service availability the poor, and improve financial coverage; Secondly, the foundation of branchless banking practice in China should be modern information and communication technology;Thirdly,the premise of branchless banking practice is its legitimacy, so policy support should be its premise; Fourthly, as a kind of financial service innovation,the core of branchless banking is the design of the proxy system, so the agent acts as the mediation to provide financial services is one of the principles; Fifthly, profit is the basic source that makes sustainable development of branchless banking, so the pursuit of profit is the main goal of this business.The fifth chapter discusses the roles,rights and obligations ofthe main players of branchless banking:the agent, the agent of network management (ANM) and financial service provider. As to agent, the paper mainly discusses the basic qualifications, rights and obligations, assessment and lifting as well as its interests; As to ANM, the paper mainly discusses its role, challenge, and the benefits; As to financial service provider, the paper mainly discussesthe design of the products and services, agents standards, agents network building, ANM mode selection, pricing, the income distribution of supply chain, customer protection, and so on.The sixth chapter mainly discusses the choice of the business model of branchless banking of our country, Which mainly includes the following five aspects:The first, the paper analysis the strategic environment of branchless banking of our country, from the aspects of policy system, technology, education, etc. Based on the modles introduced preamble, and combined with the reality of our country, the paperanalysis the pros and cons of different modes, and finally puts forward the bank-basedservice mode, and cooperates with mobile operators;the second,according to the standard of geographical location, financial strength, reputation, and the ability of acceptingnew things, the paper puts forward a proposal ofusing the widespread commodity store business entities in rural regions as agent; the third, according to the standard of human base, technology base, abundant capital strength, the experience of managing agent daily operation especially the management of its liquid, the paper puts forward the suggestion of selecting the mobile operators as ANM,and as to liquidity managementforagent, the paper puts forward the suggestion of mobile operators to make a cooperation with major financial institutions such as rural credit cooperatives, village banks; the forth, in addition to the agent, ANM and financial service providers, this paper also discusses other third parties such as rural credit cooperatives, small loan companies, village banks and rural capital supportinstitutions that participate in branchless banking business,and gives corresponding suggestions.The seventh chapter analyses the respective risks and the corresponding risk management advice from the aspects of customers, agent and financial service provider. The risks that come from customer are mainly fraud, selecting unnecessary products and cannot effectively rights and thus suffer the loss; risks come from agent mainly include cash risk, financial risk, operational risk, management risk, risk of fraud and money laundering, and other risks; risks come from financial service providermainly include the ineffective management and control risk of branchless banking business and the risk that brought by mobile operators by issuing the virtual currency. Aiming at these risks, this paper gives respective risk management ideas. As to customer, the government and suppliers should help improve their basic attitudes, financial knowledge, and financial skills, etc; and the supplier should take measures of self-regulation such as agency policies and procedures, regular audit of agency network, risk sharing and punishment mechanism, internal control and audit and supervision report, the emergency plan; the government’s risk management ideas mainly include prior consent and post-supervision two aspects. In the aspect of prior consent, as the only legal institutions that is able to establish standards, it is necessary for the government to make some basic standards in advance; In the aspect of post-supervision, the government can also use afterwards supervision means and tools such as regulatory reports, database and on-site inspection to cope with the potential risks.