Agent banking

This policy set refers to regulations governing correspondent banking agents, aimed at enabling low-cost delivery channels and reducing both the fixed costs of setting up and maintaining branches and the high variable costs of small transactions.

In Brazil, a large public bank partnered with non-bank agents to distribute welfare grants, a model that has been replicated by other banks which are partnering with retail commercial outlets to deliver financial services to previously unbanked low-income and rural people, with the use of Point-of-Sale (POS) technology and simplified account-opening rules. By 2005, such collaboration had led to the creation of an estimated 90,000 correspondents, with over 9 million current accounts added in Brazil between 2000 and 2004.

Further, while in 2000, more than 1,600 municipalities in Brazil had no bank branches or agents, by the end of 2003, banking services were available in all of the more than 5,600 municipalities of the economy, largely because of this increase in non-banking agents. The key challenge is to broaden access to include the whole range of financial services.