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Bridging Divides

HELPING BRIDGE URBAN AND RURAL ECONOMIC AND SOCIAL DIVIDES

Elizabeth Rova, Team Leader Rural Banking in Fiji, joins her colleagues delivering much needed basic banking services to rural and remote communities across the Pacific.

Reducing the economic and social divides that exist between urban and rural regions is a significant priority for governments and communities in many Asian and Pacific markets where we operate. As one of Australia’s largest investors in the Asia Pacific region, there is much we can do to help bridge these divides.

We support the local and international businesses which create the industries, jobs, products and services that underpin thriving communities. We are also working with governments, multilateral and community organisations in a number of markets to improve financial capability and inclusion among under-banked and rural communities – at the same time developing new markets and customers for our future.

Supporting Economic Development in Rural China

As part of our growth strategy and long-term commitment to China, we opened our Chongqing Liangping Rural Bank becoming the first Australian bank to invest in China's rural finance area. In addition, we obtained preparatory approval to establish a city branch in Chongqing and, pending final regulatory approval, aim to launch the Chongqing branch by the end of 2010.

This area of Western China is a priority economic development zone. It is home to more than 31 million people, including some 900,000 in the county of Liangping, where around 90% are rural residents.

Since establishing a presence in this region, we have built a strong commercial loans business, providing much needed access to finance for small business loans among rural Chinese while sharing our banking expertise to help strengthen this local community and economy.

Our CEO, Mike Smith, is a member of the Chongqing Mayor's International Economic Advisory Council and we have also supported a year-long training initiative to improve the sustainability of the pomelo industry, a major contributor to the Liangping economy.

The training provides farmers with advice on business management, marketing, branding and trademarks, and plantation and cultivation skills with practical sessions to improve yields.

Around 2,000 farmers, agricultural committee officials and representatives of local pomelo industry associations have participated in the program to date.

We are continuing to improve access to basic banking services and loans for individuals and businesses, while extending the agricultural, marketing and financial literacy program to more farmers in the region.

Building Prosperity in Rural Fiji

Our rural banking service is playing a significant role in improving financial inclusion and family wellbeing in rural households across the Pacific.

Launched in Fiji in 2004, the service reaches more than 85,000 people throughout Fiji, the Solomon Islands, Samoa and Vanuatu. Purpose-built trucks travel between remote villages providing access to transactions and savings accounts and, in some areas, micro-loans for small enterprises.

According to a report released this year the service (together with a supporting United Nations financial education program), is helping to enhance the lives and livelihoods of the 300 rural Fijian communities we serve.

The Financial Capability, Financial Competence and Wellbeing in Rural Fijian Households* study measured the financial skills of rural Indigenous Fijian villagers and used ANZ’s rural banking services as a case study to illustrate how providing banking services creates greater financial inclusion and prosperity for people living in remote locations.

Among its findings, the study found villagers who have access to banking services and financial education are more likely to have funds to re-invest in their farm or business and the ability to manage spending and re-invest any surplus funds has a positive impact on the overall family well-being.

We are currently exploring opportunities to use technology to provide lower-cost and more convenient options to deliver banking services to rural communities; increasing access to micro-loans to further support economic development in the region; and expanding our MoneyMinded financial education program across the Pacific.

*The study was conducted by the United Nations Development Program (UNDP) Pacific Centre in conjunction with Massey University, New Zealand and the National Centre for Small and Micro Enterprise Development.

"The research shows that the combination of financial literacy and access to reliable financial services has a direct impact on helping to lift communities out of poverty.
"It provides households with the ability to manage their resources to provide funds for education, food, electricity, water, improved sanitary conditions and medical services."
­­ Knut Ostby, UN Resident Coordinator in Fiji

Improving Economic and Financial Inclusion in Cambodia

More than 180,000 Cambodians, many of whom had little or no access to financial services, have registered for our mobile banking service, called WING.

Fewer than 5% of Cambodians currently have bank accounts, while more than 80% have access to mobile phones. Mobile banking therefore provides affordable, accessible, secure and fast services to a largely unbanked population.

Customers access their WING accounts to make secure, immediate payments using a personal identification number via any mobile phone. They can also deposit savings and make or receive cash payments through more than 600 Cash Xpress outlets located in all of Cambodia’s 24 provinces.

Using WING, customers can avoid the often costly and unsecured channels of taxis, couriers or middlemen, while gaining the security and speed of using mobile technology. Parents supporting children studying away from home, migrant workers sending money home to their families in villages and farmers receiving payments from markets all benefit from using WING.

A $1.5 million grant from the Australian Government’s AusAID Enterprise Challenge Fund has helped to extend the availability of WING outside urban centres.

Our experience with WING has taught us much about the emerging market of mobile phone banking and payments, the ‘next wave’ of banking innovation.

In September, we launched goMoneyTM – Australia’s first iPhone banking application enabling customers to securely transfer money between friends, relatives and businesses using mobile phone details.

WING customer Kong Chan Ny is a market trader selling Chinese broccoli grown by local farmers in the Takhmau market – 15 km out of Phnom Penh. She uses WING to make her micro business more efficient.
“Getting money to my producers takes a lot of my time and it also can be a security risk. WING is easy and fast to use, I am encouraging my producers to use WING so I can transfer the money I owe for my vegetables.”
KONG CHAN NY
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Research conducted in partnership with the International Finance Corporation and released this year reveals 56% of WING customers were previously unbanked. Of these 67% are women, 48% live outside the capital Phnom Penh and 64% live in households where income is less than US$5K per annum.

Key Goals We Set Out To Achieve In 2010

KEY GOALS WE SET OUT TO ACHIEVE IN 2010 PERFORMANCE
Complete and release an evaluation of our programs supporting rural financial inclusion in Cambodia (WING).
Complete and release an evaluation of our programs supporting rural financial inclusion in the Pacific (Banking the Unbanked).
  • Achieved or on track to achieve
  • Partially achieved or in progress
  • Did not achieve
 
See anz.com/cr/performance for more detail