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Posted on October 27, 2015

The nexus between financial inclusion and geospatial data

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FSD Kenya recently concluded a geospatial mapping of all financial access points in Kenya, including bank branches, Automated Teller Machines (ATMs), Deposit Taking Microfinance Institutions (DTMs), bank agents, mobile money agents and more.. The results show remarkable growth over two years, the details of which will be released on Thursday 29th October.

Geospatial mapping, whose origins lie in tactical warfare, is older than the gun itself. Today, we in the financial services sector also find it a valuable tool for strategic decision-making. We carried out this latest innovative mapping project in conjunction with the Central Bank of Kenya (CBK) and the Bill and Melinda Gates Foundation.

Geographic Information Systems (GIS) maps differ from traditional maps in two key ways: there is no limit to the amount of additional data that can be added to a GIS map, and GIS maps can be used to analyse statistics to present data in support of particular arguments.

GIS maps provide facts and figures to drive evidence-based corporate decision-making. They are as useful to those of us wishing to boost financial access as they are to the military commanders planning troop movements and monitoring possible terrorist activity.

GIS and financial inclusion

Here are some key questions about financial access that GIS mapping can help us answer:

  • Where do the poor people live?
  • What do they do for a living?
  • How do they pay for their goods and services?
  • How does the entire value chain look like for their staple foods?
  • Where is the financial services infrastructure relative to where they live?
  • Where it exists, does it provide the appropriate services and products to serve their financial needs?
  • Are poor people aware of these services?
  • What can the financial services industry and other interested parties do to create awareness, increase coverage, drive uptake and usage among the poor?

Just as the military uses GIS applications in a range of ways, financial services providers (FSPs) and financial access professionals can exploit geospatial data to promote access, and ultimately, enlarge shareholders’ wallets.

Top four ways in which we can use GIS data

  1. Government departments can use geospatial data to safeguard the access of low-income households to financial products and services, or to understand the contribution of geographic variations to macro-economic phenomena.
  2. FSPs can use geospatial records to make strategic decisions about locating and evaluating branches and staff, or integrating their own customer data for segment-based targeted product value addition.
  3. FSPs can better analyse unserved areas by layering points on top of population density and determining, for instance, the percentage of population within 5km of a service point. This also helps in identifying market trends and locations that are lagging behind in particular product offerings, thus identifying market opportunities for the FSPs.
  4. Research units and business analysts within the FSPs can use GIS data in targeting product interventions according to local financial levels and market penetration, as well as monitoring success. Lastly, survey data layered with GIS information can provide predictions in areas with little or no data since GIS layers can help build better business predictive models.

Findings from FinAccess GIS Mapping 2015, Kenya

The results of the newly concluded geospatial mapping of financial service access points in Kenya will be released at an event in Nairobi on Thursday 29th October. You can expect to see significant growth over the two-year period since the previous mapping in 2013.

A deep-dive into the survey results is expected to reveal varying growth rates for the different financial service access types, including mobile money agents, bank agents and stand-alone ATMs.

This data has untapped potential to support the development of businesses and financial service providers across Kenya. Once it is in the public domain, we will be asking how we at FSD can help them tap into it. Watch this space! And follow #FinAccessMaps on Twitter to stay updated.

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