How to mitigate Agent Recruitment and Onboarding risks from the early start?In the last decade, financial services have been through an innovation cycle aiming to serve the unbanked populations in emerging markets. Although there are still many challenges to enter the financial ecosystem, low-income individuals, micro-entrepreneurs and rural populations are now accessing financial services through mobile phones and networks of agents acting as representatives of financial service providers.

However, like in every innovative business operations that offer technological opportunities, there are also risks associated. In order for the financial inclusion industry to be able to capitalize fully on the benefits of digital financial services, it is important to identify, understand and address conveniently those risks. Therefore, it is essential to building a risk matrix when designing a delivery strategy. The risk management should consider four different levels: strategy, security, operations, and compliance.

Strategy

  • Competition

    Commoditized products make competition very high once they are available everywhere and the consumers make their decision based only on what it is most convenient for them in terms of brand taste and location. This could lead to a gained market share by the competitor who offers a superior service, which is considered a severe risk. Solution: Improving service quality through an effective agent selection provides a great value proposition to your business.

  • Rejection by clients 

    Rejection can happen for many reasons including high costs of service, poorly trained agents and agent mistrust, which is a moderate risk. Solution: Agents recruitment and onboarding process must be reviewed to evaluate if agents match with the required profile.

    Papersoft Mitigation: Robust Agent KYC process

Security

  • Robbery of/by an agent 

    The agents can be robbed on their work environment once they are always walking in different locations or they can steal from the provider. Solution: When onboarding new agents it is important to recommend them to purchase theft insurance as well as educate them on cash safety measures. Monitoring daily transactions reconciliations is also an important measure to prevent this severe risk.

    Papersoft Mitigation: ID Verification and document checks;
    Training area 24h available for agent training on cash safety;
    Auto- reconciliation tools

Operations

  • Agents poorly trained 

    The inability to provide effective assistance to customers increases the risk of losing them and restricts the service scale. Solution: Carefully identify, select and motivate agents, giving them a robust onboarding and on-going training while providing adequate tools to prevent the severe risk of agent churn.

    Papersoft Mitigation: Training area 24h available for agent training

  • Agent supervision

    Neglect the supervision process could be a severe risk of failing to adequately select, train and supervise agents. Solution: It is necessary to review the recruitment and selection process to ensure a fluid and effective way to recruit the best Agents as well as develop an on-going training program.

    Papersoft Mitigation: Training area 24h available for agent training

Compliance

  • Agent KYC

    Compliance is critical for organizations that want to meet legal requirements and avoid heavy penalties, which means it is also a risk not having a KYC compliant process when onboarding agents.

    Papersoft Mitigation: ID verification and document checks

If you want to know more about the importance of a well-structured onboarding process and how it can leverage the potential of agents as an Alternate Delivery Channel – ADC, download our ebook “Agents Recruitment & Onboarding Process”.


Aiim Report - "Digitalizing" Core Business Processes