Managing the agent network is the most critical post-launch success factor for a telco-sponsored mobile money service, analysts at McKinsey and Company say. Agents conduct the cash-in and cash-out functions, enabling customers to convert cash into electronic money and back again in convenient locations; in the eyes of the customer, the agent is the face of the company.
Many providers focus on building their agent networks as fast as possible, but that is a mistake, McKinsey says. Getting the agent network rollout right is one of the most complicated aspects of launching mobile money.
If a provider enlists too few agents, customers perceive the system as difficult to use, or even useless. On the other hand, if there are too many agents, many of them cannot generate enough business to cover the cost of managing liquidity.
As an example, one of the keys to Safaricom’s continued success has been its decision to match network growth to customer-base growth, ensuring a steady 1,000 transactions per agent per month.
The initial network will likely number in the hundreds, not thousands, and it does not have to cover the entire country. Safaricom launched M-Pesa with just 400 agents in a country of almost 37 million people. For larger countries, some experts urge a regional launch, accompanied by later rollouts.
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