IME Digital

January 16, 2018



The financial sector of Nepal is growing steadily, offering financial products and services through its various delivery channels. However, the challenge is to address the constraints that exclude a larger population from full participation in the financial system. Even today, large rural populations in the country lack access to formal financial services as reach with brick and mortar branches are financially not viable.

Nepal Rastra Bank (NRB) came out with a licensing policy for the Payment Service Providers (PSP) and Payment System Operators (PSO) to provide financial services by using internet, mobile device and or payment card services in 2016. This policy opened the avenues for Telecom companies and other non-financial companies to come into the business of financial services.

Challenges Faced

People in the region are involved in stable income sources from activities like agriculture and remittance income, yet they are compelled to rely upon informal sources and high cost financial sources. Many financial institutions are reluctant to spread its outreach in the mentioned areas due to poor infrastructure, cost, and security among other reasons.

MFS has greatly changed the access to finance status in many developing countries in Africa, Latin America and Asia Pacific. There had been some initiatives in the past to offer the mobile financial services (MFS) in Nepal but they did not have a sizable traction of customers, merchants and utility companies. Basically, the MFS were of small scale, lower investment and did not have synergy effect with the partners. It is also clearly learnt that the Agent Network Management (ANM) was the biggest drawback of such initiatives whereas, for any MFS to be successful there is a need of a strong ANM. Likewise, a value proposition to different stakeholders was missing to make them interested in the MFS business.

Sakchyam’s Intervention

IME Limited- the largest remittance company in Nepal bringing in more than USD 1 billion from abroad every year is serving millions of customers for more than 15 years now. IME has a strong agent network of more than 5,000 agents throughout the country with established cash management and settlement mechanism. IME has a vision to digitise this remittance and bring its customers into financial services arena through the mobile wallet services whereby linking them with banks for further financial services and also link to insurance products.

Sakchyam had been looking for a strong partner to come into MFS business who could make a national level impact in the outreach of financial services.  Amongst the proposals received as a response to Sakchyam RFP (Request for Proposal), IME Digital Solution (subsidiary of IME) was found to be the strongest one. Sakchyam believed the objective of reaching out a larger customer base with MFS would be possible through this partnership.

Likely Impact

The project offers nationwide MFS bundled with products like money transfer, bill payments, account opening, deposit and other banking and insurance services. It will start the implementation from existing remittance receiver client base (about 450,000) and gradually move towards other customers. In order to create a sustainable financial ecosystem, IME will be partnering with MNOs, commercial banks, BLB agents, merchants in reaching out the financially excluded sub-urban/rural, under-banked and unbanked population and offer an alternative payment channel.

Target beneficiaries (886,915): Students, working Professionals, traders, agricultural businesses, and G2P recipients. 75% of the target beneficiaries shall be youth, 45% women, and 35% DAG.

Key Innovation:

  • Introduction of interoperable and large scale third party led mobile wallet products in Nepal
  • Transition from traditional remittance payment system to mobile wallet based payments
  • Linking mobile wallet with the bank accounts
  • Rolling out of simpler infrastructure to facilitate Person to Person, Person to Business, Business to Person, Business to Business, Person to Government, Government to Person payments

Through this partnership IME Pay has already brought on board 65,000 customers, over 13,000 agents and over 400 merchants in its network which includes IME Remittance Agents and new agents. This partnership aims to have 15000+ agents and 1 million customers in the next one year.

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