Sustainable growth, traditionally, has meant the realistically achievable growth that a company or national economy could maintain without running into problems. It is the growth that a firm enjoys within its current resources without running into problems.
All businesses, including banks such as Rural and Community Banks (RCBs) face challenges of creating long-term growth with limited resources. RCBs are particularly limited within a certain catchment area, and face a herculean task of limited clientele among other things.
For businesses to sustain their long-term growth they must have clear purposes, and partner and collaborate with industry players. In addition, they must have and project a strong and unique brand and be able to attract potential clients and maintain existing clients. For this article, I will emphasise their unique branding, services and products delivery, and community building and involvement by the RCBs to achieve sustainable long-term growth.
Branding The RCBs
Branding is the process of promoting a product, service or a company by means of advertising their distinctive designs which make them stand out of the crowd. It is a concept that seeks to etch the name, symbol or characteristics of a service, product or company on the minds of their intended public. The RCBs, established in the early 1970s, suffered a series of credibility failures when every news item on them involved one problem or another.
However, with the advent of ARB Apex Bank and the support of other international agencies, RCBs have emerged from the doldrums and are taking their rightful positions as the go-to financial institutions for small savers, farmers and SMEs in small towns and peri-urban communities of Ghana.
It is instructive to note that with all the recent tumult in the banking sector in Ghana, not a single rural bank has been heard of as being unable to meet its clients’ withdrawals or any of its clients’ banking obligations. This is something that must be celebrated and enhanced by all RCBs and the Association of Rural Banks and the ARB Apex Bank.
In the area of branding, some individual RCBs have done very well in positioning their unique brands in the minds of people within their catchment areas and beyond. Such rural banks include Lower Pra Rural Bank (Shama), Ahantaman Rural Bank (Agona Nkwanta), Fiaseman Rural Bank (Bogoso) all in the Western Region; Atwima Kwanwoma Rural Bank in the Ashanti Region, Adonten Community Bank and South Akim Rural Bank in the Eastern Region, just to mention a few, have all done well to become household names in their respective catchment areas.
What the other banks must do is pay attention to the image they project to people in the communities. By carefully constructing their unique brands through outdoor programmes, relationships, marketing messages and visual assets, RCBs can create the opportunity to shape their existing and potential clients’ expectations of their banks and establish a unique bond that will go beyond just the day to day depositing and withdrawal of funds. Brand image when properly managed establishes a special long-term emotional connection between the RCBs and their customers.
Services and products delivery
RCBs today essentially deliver similar products and services like all other banks. The difference is in how those services are delivered. RCBs are however in a position to provide better services than other financial institutions which compete with them in their catchment area, as they have branches even in the remotest parts of the rural areas. RCBs must pay attention to products/services delivery to enable them attract more clients from the mainstream banks and other non-banking financial institutions.
The RCBs can achieve this by:
- Offering a better quality service to clients – such as a faster turnaround time, door to door cash delivery, or lodgment services to those of their clients who by the nature of their businesses cannot be present at the bank frequently.
- Increasing the delivery-speed of their services to their clients. It is very disheartening to want a service such as loan from your bank in the shortest possible time, but it takes an unduly long time between processing, approval and final disbursement. UT Financial Services was known for ‘a loan within 48 hours’, and others had copy. That identified them and gave them an edge over their competitors, such that the competition could make no better response than to copy them. Individual RCBs must look for something to be identified with that will stand them out, make them distinct from their competitors. Lower Pra Rural Bank in the Western Region, for example, became known for its group loans to market women, artisans and fisher-folk – so that even the World Bank paid attention and once sent practitioners from as far as USA, Mali, Germany and the Philippines to understudy its delivery systems.
iii. Provide additional expert advice to clients other than the normal day-to-day banking advice. It is an open secret that many RCBs operate in the rural areas where financial literacy is low. This places rural bankers in a position to offer advice to guide their clients in their businesses, or even in which financial instruments or investment they should put their funds in.
During the height of the Menzgold investment frenzy, the six people who came to my office to move their funds to Menzgold either ended up investing in fixed deposits from my bank or were convinced to reduce drastically their intended investment in Menzgold.
This all happened because I provided them with advice on why my bank’s investment products were safer and more protected. But this requires the RCB staff to be on top of issues in the financial and investment environment in Ghana and beyond. They must also have a deeper knowledge and understanding of their own banks’ comparative advantage. No staff can give any good advice to a client if they are not knowledgeable enough on the strengths of their own products and services vis-a-vis similar services and products of their competitors.
- Add simplicity to customer interactions with the banks, and let clients feel at ease and welcome so they’ll be eager to do business with you. It is important for RCBs to have a one-stop desk where all general information a potential or existing client may need can be accessed without delay.
This enhances turnaround time and attracts other clients to do business with the bank. And above, all customer services should be enhanced; it is not good to tell clients that a system is down or you are having some form of systems or operational difficulty and therefore cannot access services. All alternatives must be explored for continuous services to clients while the problem is attended to. Clients don’t really care about whether your systems are down or not; all they need is provision of the services you promised to offer them when they opened accounts with you. That is your charge to fulfil.
Identifying and building relationships in the Community
Rural and Community Banks exist in communities where people, other RCBs and entities interact in different ways. For the necessary long-term growth, RCBs must identify with the community they are established in to attract, especially, the youth to do business with them. It is not enough to think that once a bank or branch is established in the community the people will identify with it, accept it, and do business with it. Communities are vital for sustainable growth because they provide the RCBs with the structures they need to support them.
RCBs must get involved in the social programmes to serve and create a community, and then monetise their involvement by providing goods and services which serve the needs and passions of the community. This approach can help them attract new clients and maintain the existing ones to enjoy sustainable growth.
Community-building must start within banks’ own staff. It is unwise to start a new bank or branch with all staff from outside the community. Even if some staff must necessarily come from outside the community, encourage them to identify with the community as their own. It would be unwise for RCB staff not to be seen partaking in, say, community festivals in which all the local leaders are involved. Such an attitude would send a signal that the bank does not belong.
For RCB to ensure continuous or sustainable growth, they must also embrace a social cause that extends customer impacts. Banks that support local programmes and extend social help to their local communities etch themselves firmly on the minds of people in the community. Community-building by RCBs must also involve developing a value-driven presence on social media. The philosophy behind building a social media presence within the community is to share content which enhance the lives of customers – while creating in their minds a constant reminder of the bank’s presence. The very nature of a social media community is that participants share contents which support their members. Sharing not only keeps the community together, it brings in a constant flow of new members – each of whom may be a potential customer to the banks.
These are not the only drivers of sustainable growth. Individual RCBs must put in the time and resources to uncover and fix their unique growth roadblocks, given the peculiar terrains they operate from. Once you know what’s in your way, you can then figure out the best levers to pull so as to drive sustainable growth.
Francis Enimil Ashun has extensive experience in Rural Banking in Ghana. He is a researcher in current trends in Human Resources Management, and Development and Rural Banking. He may be reached on firstname.lastname@example.org