Strategies for Building a Deposit Base, May 2006

The CEO Banker-to-Banker Peer Learning Forum held in May 2006 focused on considerations in the development of a local deposit base. Participants shared experiences from within their organizations, including optimal positioning strategies, customized product offerings relevant to reaching out to the deposit market, and the role of technology in mobilizing deposits.

Quick Lessons

• A useful strategy participants had tried was to target the unbanked population, which they found to be less sensitive than those that are already banked (where there is often head-to-head competition amongst service providers). While the poorer segment may be illiterate, many individuals in that group understand how to use phones, and thus are familiar with the interface used by ATMs and other technology such as mobile banking. This can be used very effectively to initiate new services with clients.
• Those with successful deposit mobilization approaches tend to work towards low transaction costs (some examples were quoted where banks limited services to lower the cost of delivery and offered improved interest rates for continued service usage by customers) and explore new technology and methods of raising deposits and delivery channels

This phone forum was followed by an in-person CEO Forum in Washington, D.C. in September 2006.  Click here for more information.

Attracting Investors to Small Business Banks and MFIs, December 2005

The call focused on investor-investee perspectives on development finance. Exchange subsequently developed a publication on building successful investor-investee relationships; please click here to access the publication.

Quick Lessons

• Participants discussed the evolution of appetite for investing in microfinance and small business banks. In the early stages, development finance institutions (DFIs) have typically taken the lead but as performance is demonstrated local investors are often attracted more easily. If the DFIs can facilitate increased leverage in the MFI, this improves commercial sustainability, returns to investors, and assists balance sheet growth. Different groups of investors also bring differing expertise to the relationship, and institutions should choose investors according to their own needs at the time. The effectiveness of local versus international investment depends in large part upon the maturity of the banking institution.

Staff Retention and Staff Leadership Development Strategies, May 2005

This CEO Forum call was the first of the series. The group debated the optimal means of improving staff retention, with reflections on what had worked (or not) for each. CEOs spoke to strategies to maintain the culture and values of the organization, even when the company is growing and new employees are joining the firm. The group discussed how organizations benefit from collaborative (e.g. more inclusive management decision making) rather than authoritarian management, with benefits typically showing in retention levels. Performance management was identified as a key issue in staff retention and leadership development.