Getting to Know You(th): How Piloting Allowed HFC Bank to Sharpen Its Value Proposition for Young People

YouthSave’s bank partners began creating their youth savings accounts in 2010, with extensive market research that obtained firsthand information about the savings habits, needs, and preferences of young people. But using these data to design the savings accounts was not enough; the resulting product prototypes still had to be “road-tested” in order to confirm that we had correctly a) interpreted the market research, b) translated it into product designs that met youths’ needs, and c) put in place the right marketing, back-office and sales systems, policies, and delivery channels. In three countries – Ghana, Kenya and Nepal – YouthSave’s bank partners did this through time-bound pilots in a limited number of branches. These pilots yielded valuable lessons that ensured the products’ success when they finally rolled out network-wide in 2012.

In the second installment of YouthSave’s Measure Twice Cut Once blog series, we share how piloting enabled HFC Bank to understand whether it really knew what it thought it knew about young people.

Getting to Know You(th)

The market research undertaken for HFC Bank’s YouthSave-sponsored product, Enidaso, directly involved bank staff in focus groups and interviews with prospective clients to a degree that was unprecedented at the bank. HFC staff thus got to hear firsthand from youth about their dreams, aspirations, and constraints related to savings. The bank also solicited youth views in finalizing the brand concept for the product (in fact the product name, which means “hope”, came directly from a youth focus group). But even with all this consultation, there is always some uncertainty as to whether clients actually want what they say they want. The Enidaso pilot test enabled HFC to find out.

HFC piloted Enidaso for six months in four of the banks’ 26 branches, across the same diversity of geographic zones in which the market research had taken place. Turns out, listening to youth pays off! The pilot evaluation exercise revealed that over 90% of youth clients liked the product and would recommend it to a friend. They particularly appreciated the sense of ownership over their savings that Enidaso’s design gives them. Even though regulation requires a child below the age of 18 years to have an adult help them open and operate an account, Enidaso prevents the adult from accessing funds without the knowledge and consent of the youth account holder – a provision unique in Ghana, which reassures youth about the safety of their savings. As one girl in the Tamale branch affirmed, “My account…is mine. I know it and no one can take money from it without me.”

The pilot evaluation also revealed that having an ATM card was an unexpected draw for young people. This card allows youth to check their balances for free at HFC ATM machines, and costs approximately $1.50. But the cost does little to deter youth from obtaining them, as they are viewed as a status symbol among their friends and community. Originally an add-on to Enidaso, the ATM card has now become core to the product’s USP.

In addition, youth told pilot evaluators that they liked being engaged by branches – an encouraging validation of the staff’s significant efforts to reach out to them. One 17-year-old boy from Ashaiman praised the bank’s friendly attitude towards young people when he said “The manager even calls me to remind me to deposit my savings. I feel good about this and it motivates me to save.” Youth also said that they very much like coming to the branch to make transactions – if they live close by. But the branch staff’s efforts at engagement proved particularly important for kids who lived further from branches. In such cases, staff have begun to come to schools to open accounts and collect deposits.

Most of all, it was clear from the pilot that kids wanted to save – even after the initial three-month restriction on withdrawals had expired, those accounts registered only 7 withdrawals as opposed to 470 deposits in the first three and a half months following the pilot test launch. In this way, said Christine Kwaning, then manager of the Ashaiman branch, the pilot “gave us an opportunity to know that there are people who desire to save for the future but do not know how to go about it.”

Not only this, but the pilot revealed that the initial parental skepticism that had surfaced during market research could be converted into strong support with the right information. Branch staff began to focus on clearly explaining Enidaso product features during PTA meetings or when parents came to the branch. As a result, Mrs. Kwaning continued, “The majority of parents embraced the product as something long overdue. They saw it as an opportunity for the youth to also save for their future.” However, the pilot also revealed that a significant minority of youth wanted to open an account with a trusted adult other than their parent or guardian. HFC therefore decided to allow teachers and older siblings or relatives to open accounts with the youth. HFC management approved this change after it became apparent that some youth (a) lived far from their parents/guardians and (b) were more comfortable with teachers because they were already conducting informal savings with them.

In this way, said Charles Ofori-Acquah, HFC’s Executive Director for Business Development, “The market-led approach of developing products enables the customer to own the product, instead of the bank owning it.”

But do youth know the bank?

Finally, pilot findings also informed other aspects of the bank’s operations by revealing some surprising findings on youths’ awareness of HFC. Indeed, brand awareness among youth, especially non-account holders, did not seem to be very high – for example, one boy who had participated in the market research indicated during the pilot that he had never heard of HFC. This led Mr. Ofori-Acquah to ask, “Do the people we develop products for, know about them? If not, how can we better communicate the bank’s brand?” Conversations with youth also provided the answers to the questions, informing the Bank on issues like the right types of media to use in order to increase the Bank’s profile among youth. So when piloting youth products, in addition to asking how well they really know youth clients, banks would do well to ask: How well do youth know the bank?