Banking the Un-banked but Bankable in Asia Pacific

1. Banking the Un-banked butBankable in Asia Pacific Carolyn Blacklock Regional Executive Banking the Un-banked

2. What we believe at ANZ • The un-banked are those people with no bank account. The under-banked have only one or two financial products. Bankable people are everywhere (urban and rural), who have a desire or need for financial services. No one is excluded. We believe in financial inclusion. • The commercialising of microfinance urges large-scale banks to provide mainstream and new financial products to people at the Bottom of the Economic Pyramid. • Financial empowerment is an economic state of individuals, communities and countries in which they are able to make decisions to better their economic circumstance with their own money. • Financial literacy enables people, banked or un-banked to make sound, informed decisions about their money and to understand the implications of different choices. It helps people plan for a better future. • Regular savings, regardless of how small the amount, for individuals and groups leads to the mobilisation of savings which in turn enables people to build capital and borrow via MicroLoans to create new economic opportunities and sustainable livelihoods.

3. What we believe at ANZ… • The un-banked and under-banked need ANZ to innovate and deliver traditional & new products via sustainable and appropriate distribution channels. They don’t need us to judge them based on their economic circumstance • The un-banked but bankable are a viable, vital market that do not need charity or corporate social responsibility - this market represents a new opportunity for ANZ. • We are still learning, still taking baby-steps. We strive to know more about this new market not just from MFIs, donor agencies and NGOs but from clever retailers some of whom have been serving this market of the un-banked but bankable for a long time. • We are very proud of our early success but we have a long way to go • By providing sustainable, appropriate, value for money financial service products and by partnering to deliver financial education, we can make a positive and lasting difference to the micro and macro economic circumstance of individuals, communities and countries in the Asia Pacific region.

4. Business Model: Why Bank the Un-banked? “Comparative analysis of average annual growth rates in poverty, private credit and GDP over 20 years show that countries with higher levels of private credit reduced povertymore quickly”(World Bank, 2005) 1. ‘Grow the Pie” strategy. Vibrant countries = A vibrant ANZ 2. Effective distribution channels, partnerships, co-location models and technology advances make banking outreach cost effective and sustainable but still a significant challenge 3. Banking the un-banked presents a very large potential customer base ~ 6million in the Pacific 4. ANZ has been in the Pacific since 1880 and to be here another 125 years we need to 1. Help countries grow their economies and 2. Help customers grow their wealth 5. Making credit available to micro-entrepreneurs increases the level of economic activity, generating more jobs and higher amounts of money among the poor 6. We sense it is sustainable and possibly profitable business.

5. Business Model: How do we bank the un-banked? 1. Listen first – build solutions second 2. Effective partnerships e.g. UNDP, Solomon Post, PNG Post, mining companies, palm oil plantations, Fiji Police, Schools, Women’s Assoc. 3. Technology e.g Remote Banking, Tele-centres, EFTPOS, ATMs 4. Mobile Banking e.g. Fiji Rural Banking, Solomon Islands Bank blo evriwan, Samoa Rural Banking, Tonga Mobile Banking, Vanuatu Mobile Banking, American Samoa Cannery Banking 5. Unique products e.g. Rural Passbook Savings Account, MicroLoan 6. With humility & respect 7. Always with financial literacy 8. Using all of ANZs global expertise to deliver local solutions

6. Where have we got to in 12 months with this Business Model? • 40,000 new customers in Fiji (all previously un-banked) • FJD$2.3million in savings • FJD$57.50 average savings per customer • Projects in most other Pacific countries • Remote Banking – Banking in a Box developed ready to deploy • Product development – first MicroLoan in ANZ • 4 studies underway from universities that will help us further • 11 partnerships • We are just beginning and have ambitious plans to Bank the Un-banked

7. Thankyou from Carolyn Blacklock blackloc@anz.com +679 9908 256