Financial Inclusion: Expanding access to financial services through agent networks

In recent years, the concept of financial inclusion has taken center stage as governments, fintech companies, and development organizations recognize its importance in fostering economic growth. At the heart of many financial inclusion strategies is the agent network model, which uses physical agents to provide essential banking and financial services to underserved populations. This model has been particularly successful in regions with limited access to formal banking infrastructure, such as Sub-Saharan Africa.

What Are Agent Networks?

Agent networks consist of individuals or businesses authorized by a financial institution or fintech company to offer services on their behalf. These services can range from cash deposits and withdrawals to bill payments, money transfers, and loan disbursements. Agents act as the bridge between the institution and the consumer, especially in areas where traditional banking services are scarce or non-existent.

The agent network model is a powerful tool for promoting financial inclusion, as it brings formal financial services closer to people in remote and underserved communities. By utilizing local businesses and individuals as agents, financial institutions can expand their reach without the need for brick-and-mortar branches.

Building a Successful Agent Network: Key Strategies

1. Training and Capacity Building: The success of an agent network depends on the competence and reliability of the agents themselves. Financial institutions must invest in comprehensive training programs to equip agents with the knowledge and tools needed to deliver seamless services. Training covers everything from transaction handling and customer service to compliance with regulatory requirements.

2.Incentives and Support Systems: To ensure the long-term success of agent networks, it is crucial to provide agents with incentives that align with the company’s goals. In my experience at Paga, we introduced an agent loan program that significantly improved agent loyalty, alongside an emergency float system which allowed agents to maintain liquidity, especially in high-demand periods. Segmenting our agent network allowed for more effective resource distribution stimulating growth across the different categories. Offering financial incentives like bonuses or commissions, alongside non-monetary support like technical assistance, keeps agents engaged and productive.

3. Targeted Outreach and Community Engagement: Grassroots initiatives play a vital role in agent network success. Local agents often have deep ties within their communities, making them trusted intermediaries for financial services. During my tenure at Mara, for example, we focused on a grassroots crypto education campaign in Northern Nigeria, a region known for its financial exclusion challenges. By leveraging local champions (agents) who understood the region’s unique dynamics, we increased adoption significantly, with over 58% of our verified users coming from the region.

The Impact of Agent Networks on Financial Inclusion

Agent networks have proven to be instrumental in extending the reach of financial services to people who previously had no access to them. By utilizing local agents who understand the specific needs of their communities, financial institutions can:

Increase Access to Banking Services: Agent networks allow underserved populations to perform essential transactions like deposits, withdrawals, and bill payments without having to travel long distances to a bank branch.
Boost Economic Activity: When individuals and businesses have access to financial services, they can participate more fully in the economy. This includes saving money, investing in business ventures, or sending money to family members—activities that drive economic development.
Foster Financial Literacy: Agents often serve as the first point of contact for individuals new to financial services. Through agent-led initiatives, financial institutions can improve financial literacy, teaching users how to manage their money, access loans, and make informed financial decisions.

Looking Ahead: The Future of Agent Networks

As technology continues to evolve, the role of agent networks in expanding financial inclusion will only grow. The integration of mobile technology, digital wallets, and agent-based lending services has already demonstrated the immense potential of agent networks in transforming financial services for millions of people.

However, there is still much work to be done. To achieve universal financial inclusion, fintech companies and financial institutions must continue to innovate around the agent model, ensuring that agents are equipped to deliver high-quality services and meet the growing demands of their communities.

About Patience Gold
Patience Gold is an expert in agent networks, having built extensive networks across Nigeria and other African markets. Over her 13-year career, she has played a pivotal role in expanding financial access through leadership roles at Paga and Mara. Patience’s work has contributed to onboarding millions of users and driving large-scale financial inclusion. Her ability to create high-impact agent programs has earned her recognition as a leader in the fintech industry.