BNK603 Consumer Banking Assignment No. 2

SEMESTER SPRING 2012
BNK603 (Consumer Banking)
Assignment No. 2
Due Date: June 13, 2012 Marks: 25
Topic: Financial Services Market within BOP
Learning Objectives:
To develop understanding about BOP market and financial inclusion in Pakistan.
Learning Outcome:
After going through this assignment, the students are expected to learn the latest trends in the
banking environment, particularly the role of branchless banking in financial inclusion and
poverty reduction in Pakistan.
The Case
Universally, Bottom of the Pyramid (BOP) is considered as the community with income of less
than $2.5 a day. This BOP consists of the largest and poorest socio-economic group in any
economic society. Unfortunately, this BOP is deprived of the fruits of modern banking system in
the country. In Pakistan, 88% community including BOP is out of this formal financial play. In the
recent years, the country’s total cash flows including foreign remittances to BOP households in
Pakistan from their overseas family members have evolved as a substantial financial factor for
promoting economic growth. Like global financial intermediaries, various Mobile Network
Operators (MNO’s) along with financial institutions in Pakistan, have also targeted and routed
these BOP’s financial remittances through their own innovative but cost efficient networks by
using latest cutting-edge technologies. In this regard, these MNO’s have developed highly
efficient infrastructure in Pakistani far flung rural areas to capture this large market where formal
branch banking has no existence at all. But, feeling the heat of competition, now the commercial
banks are also targeting this market by introducing a wider range of services through their
branchless banking system. Examples may include “Easypaisa” service launched by Telenor
Pakistan in collaboration with Tameer Micro Finance Bank for targeting these financially. UBL
has also launched UBL Omni for the same purpose, whereas many other Pakistani banks are in the
piloting phase.
Required:
Keeping in view the above scenario, you are required to answer the following questions:
1) Give a brief account of BOP market in Pakistan. (2)
2) Why are some enterprises succeeding in meeting Pakistani BOP needs while others are not?
(3)
3) How branchless banking can play a significant role in reducing poverty and improving the
access of the BOP to financial services? (4)
4) How technology is playing as a driver to shape new channels of delivering financial services?
(4)
5) How Technology can drive the development of the financial services? (4)
6) How Remittances are promoting growth in BOP segment? (4)
7) What is the impact of expanding access to financial services, on BOP’s life style? (4)
Note:
Only in the case of Assignment, 24 hours extra / grace period after the due date is
usually available to overcome uploading difficulties which may be faced by the students
on last date. This extra time should only be used to meet the emergencies and above
mentioned due dates should always be treated as final to avoid any inconvenience.
Important Instructions:
Please read the following instructions carefully before attempting the assignment
solution.
Deadline:
· Make sure that you upload the solution file before the due date. No assignment
will be accepted through e-mail once the solution has been uploaded by the
instructor.
Formatting guidelines:
· Use the font style “Times New Roman”/ “Arial” and font size “12”.
· It is advised to compose your document in MS-Word.
· Use black and blue font colors only.
Solution guidelines:
· Every student will work individually and has to write in the form of an analytical
assignment.
· Give the answer according to question.
· For acquiring the relevant knowledge don’t rely only on handouts but watch the
video lectures and use other reference books also.
Rules for Marking
Please note that your assignment will not be graded or graded as Zero (0) if:
· It has been submitted after due date
· The file you uploaded does not open or is corrupt
· It is in any format other than .doc (MS. Word)
It is cheated or copied from other students, internet, books, journals etc…
Important Note for those courses where calculations and graphs are
required.
· Calculate to the point where calculation is being required. NO need to write irrelevant
material or extra interpretation.
· Draw diagrams by yourself. Do NOT copy from any source. NO need to write
irrelevant material.