E-kyash

E-kyash, Belize’s first digital wallet, places great emphasis on reaching the unbanked population including adults and youths to fulfill Belize’s financial inclusion strategy.

Innovation presentation

Introduction:

Our journey to the digital payment revolution first started in 2019 when the Central Bank of Belize developed Belize’s National Financial Inclusion Strategy. The research which went into the Financial Inclusion Strategy highlighted the fact that there were large segments of the Belizean market which remained untapped. This then led to a series of discussions around how these various segments could be included in the financial system as there was a clear sense that their inclusion would not only increase financial literacy but would also add to the country’s sustainable development, alleviating the significant poverty level of 52%.With this in mind, we (Belize Bank) introduced Belize’s first digital wallet, E-kyash.

E-KYASH was the first digital wallet in the country to be fully approved by the Central Bank of Belize after a thorough vetting process. It sits on a robust platform and has met and surpassed the highest regulatory standards not just in Belize but the entire Caribbean. E-KYASH has been propelling the shift from a “Cash Heavy” to a “Cash Lite” society in Belize. It focuses on reaching the unbanked Belizean population which currently stands at approximately 35%. Regardless of the social or economic status, gender, and education, E-kyash is here to ensure that every Belizean citizen has immediate access to financial services. With the simplified onboarding process E-kyash has the ability to include many unbanked citizens into the financial system, especially youths, women, lower-income populations, micro and small businesses, and those living in rural areas.

Belize Bank’s E-kyash mobile wallet software allows us to offer multiple functionalities and services on a single platform. It offers several use cases for various segments that involve types of billers, merchants, customers and agents.

Personal Users:

The simplified onboarding process offered by E-kyash is the first ever approved digital onboarding in the country and it was introduced before the official enactment by the country’s regulatory body. The regulator is still currently in the process of introducing this regulation, but E-kyash pioneered this concept in the country which was fully approved by the Central Bank of Belize.

The simplified onboarding is FULLY digital and conducted by the customers themselves via the application. Customers do NOT need to present any documentation in order to start transacting. All they are required to do is to answer a couple of easy questions, and they can obtain full access to E-kyash. Simplified onboarding is of course directly related to levels of the wallet, which were launched to differentiate transactional limits allowed per level. Customers who digitally provide additional documents, can use a higher level of the wallet and transact more on a weekly and monthly basis. The levels of E-kyash are as follows:

1. Standard Wallet - Open to all users (other than Belize Bank customers) will fall under this category. After the simplified onboarding users will enjoy immediate transactionality (up to BZ$500 weekly or per transaction and BZ$1,400 monthly - thresholds were defined based on Belizean avg. salary).

2. Advanced Wallet - If limits set up for the “Standard Low Value wallet” are insufficient for the user, users can apply via enhanced onboarding (fully digital in app) for the access to higher volumes (up to BZ$1,000 weekly or per transaction and BZ$3,000 monthly).

3. Premium Wallet - ALL Current Belize Bank customers will be identified via API with Party Onboarding, and they will be able to enjoy higher volumes as they have already completed the full tedious onboarding process at the bank (up to BZ$2,000 weekly or per transaction and BZ$5,200 monthly).

End-users have three possible channels to top-up their digital wallets:

1. Via network of retail agents

2. Linked Belize Bank Limited bank account

3. Linked other Belize financial institution bank account

The E-kyash wallet is completely opened to the public.

Once personal users have their wallets topped-up and they know which wallet type they fall under, they are able to enjoy the following types of transactions:

a. Peer-to-Peer Transfers (send and request money)

b. Bill Payments (to around 100 payees, including utility companies, schools, etc. )

c. Merchant Payments using QR codes

d. Salary payments (directly to the user's E-kyash wallet). No fee has to be paid by the recipient of the salary which saves them money. Cheque encashments in rural areas normally carry a fee of $10 per item which is charged by the business processing these cheques.

e. Government of Belize Payments (Temporary Work Permit Application, coming soon: Immigration, Tax, Birth certificates)

f. Airtime (coming soon in October 2022)

g. Purchasing of Gift Certificates (coming soon in October 2022)

Users are also able to cash-out their wallets via linked Belize Bank or other financial institution accounts. Cash-out means to transfer electronic money from the digital wallet account a Belize Bank or other financial institution bank account.

In addition, E-kyash also provides a unique way of tracking expenses (all expenses done at the merchants but also bill payments, tuition payments, etc.), so that customers can track their income and expenses via the E-kyash application instead of using notebooks to manually record their expenses. Customers can easily see where they spend the most on, plan their expenses, and start saving which then leads them to create a solid budget.

Business Users (Agents and Merchants):

Agents:

In order to increase the adoption rate, agents act as access points for the end-users, especially in the rural areas (villages) of the country where the Bank’s branches are unavailable. In this way we managed to expand access to financial services. We took financial services to the customers, we did not wait for the customers to come to us.

The entire process was designed in a way that limits risks from both sides: agents and the bank.

Agents are allowed to pre-pay their digital wallet account via online transfers from the linked Belize Bank account (e.g. savings/checking) or any other Belize financial institution account. All transfers from Belize Bank accounts occur within seconds and are free of charge. Transfers from other financial institutions may carry a minimal fee (from the originating bank) for instant transfers.

Only Agents are allowed to perform cash-based top-ups for clients. Over the counter top-ups are not allowed at banks and credit unions so as to promote cashless transactions and avoid extended lines at these institutions.

Agents are able to top-up the end-user's digital wallet account (cash-in) or cash-out requested by the end-user amount from their digital wallet account (via scanned QR code). This approach limits fraud risk and allows for the limited intervention of agents in the transaction. In our continued effort to assist our Agents, which comprises mainly micro, small, and medium size businesses, the bank decided to pay commissions for both cash-ins and cash-outs. Currently the bank pays BZ$1.00 for every cash-out performed and BZ$0.25 for every cash-in performed.

Merchants:

E-kyash Merchants are considered businesses that accept payments digitally from E-kyash users with the use of QR payments or payment links. To become an E-kyash merchant, businesses or business owners are only required to:

1. Have a Belize Bank account - This account is used as the nominated business account where the business administrators or owners will be able to transfer funds.

2. Sign-up for the service - The enrollment process is done by the bank staff and the customer is only required to download the application and use the cell phone number and one-time password provided during enrollment.

3. Sign the agreement - The agreement form is quick and easy to complete. As an anti-fraud measure and for quality control purposes, business owners must sign the agreement.

Once Businesses sign up as Merchants, the are able to enjoy the following benefits:

a. Accept QR payments using either a static or dynamic QR code

b. Send payment links to customers through any communication medium (SMS, Watsapp, email, Messenger etc.)

c. Accept E-kyash payments through their e-commerce platform

Integrate via API to enjoy full end-to-end automated acceptance and real-time settlement and reconciliation

d. Participate in an automated cashback program, bringing the effective discount rate to the lowest level on the market (1%) thus incentivizing merchants to transition from “free” cash to digital channels. Benefits include:

- Security: Customers mitigate the risk of robbery when transporting the cash to the bank.

- Cost-Effective: There is no need to deposit physical cash to the bank and pay for courier and security fees. Deposits are done directly from the E-kyash wallet to a bank account (at any financial institution in Belize). In addition, employers can easily pay their unbanked employees with E-kyash instead of cheques. Cheques normally carry a fee of $2.25 per item (which is a cost to the employer) but with E-kyash, salary transfers are free of cost.

- Increased access to financing: Creates a transactional history which is improving our customer’s credit score which eases the process to obtain financing from the bank. This is crucial for micro, small, and medium enterprises as financing was very limited for them due to the lack of financial records.

- Free advertising: Merchants can also enjoy our in-app loyalty program which was designed to specifically advertise the businesses that use E-kyash. Promotional flyers are added to the E-kyash app under a designated promotional tab. E-kyash promotes participating businesses for free, organizes regular expos inviting all E-kyash merchants and thanks to it, they can promote their products and increase their revenues significantly.

Important to note is that most of our Merchants are also Agents who are able to earn the commissions listed above for Agents.

In addition, for customers to know where our E-kyash merchants are located, we created an in-app geolocation that captures all the physical store locations and online business lists.

Security:

To provide peace of mind for our end users and agents we integrated the use of PIN and password features. End users can also login with biometric authentication. Security questions were also added in the event the users forget their pin or password. So, even if a customer loses his/her phone, funds cannot be accessed from their E-kyash account.

These features make E-kyash a safe financial service.

Conclusion:

All over the world digital wallet solutions are laying the foundation for the next generation payment systems and infrastructure. Not only payments, digital wallet solutions also provide banks with an opportunity to boost customer relationships, market differentiation and revenue sources which is certainly the case for us.

With the introduction of E-kyash, we have not only been able to tap the unbanked market but also the estimated 40,000 young people, ranging in ages from 14 years to 18 years who, quite unfortunately, also have no bank accounts. Both personal users and business wallets have been able to put Belize one step ahead in fulfilling the national financial inclusion strategy.

Uniqueness of the project

The financial services international market has experienced considerable change over the last five years. Technology and a shifting regulatory environment have acted as catalysts for innovation – and they will continue to do so. Belize, with an emerging market, is already adapting international trends via a well regulated financial environment and innovative initiatives which will drive adoption of technology among citizens. E-kyash is the first ever digital wallet in Belize and what differentiates us is:

1. A Digital Financial Awareness Online course was developed to create awareness of digital financial literacy among the young population. This was integrated as a part of the curriculum for secondary schools in collaboration with the Ministry of Education to ensure that the participating students fully understand the importance of transitioning into a cashless society.

2. Staff went through a thorough and intensive training, followed by hands-on practice, tests, and certification to be able to know the functionalities of E-kyash which enabled them to promote the product and resolve customer queries instantaneously.

3. We tailored our product to reach the untapped market including youths (14 to 18 years of age).

4. Youths have started to use it as a form of payment at school cafeterias.

5. The Government of Belize has embraced the services provided, has integrated, and continues to integrate this as a payment method on several government offices, including online payments.

6. It is being used to pay for different services at city and town councils (e.g. traffic tickets).

7. The wallet comes with widespread integration of payment services to utility companies and businesses across the country. These include insurance companies, supermarkets, internet companies, electricity companies, telephone companies, inter alia.

8. Users can easily split their payments with friends or family members.

9. Allows users to make transactions at listed merchants and locations.

10. We collaborate with merchants to promote their products/services in app.

11. E-kyash is available in Spanish as well since 56% of the population are able to speak Spanish.

Moreover, we are proud to also mention that E-kyash was selected to participate in the GSMA survey for emerging markets mobile money which is supported by Bill and Melinda Gates.