Mobile Phone Banking Services Initiative Highlighted During the 50th Anniversary of USAID and Peace Corps

The United States Agency for International Development Agency (USAID) and Peace Corps organized an event demonstrating their involvement in the Philippines to mark their 50th anniversary last November 4 at the SM Mall of Asia Music Hall. In line with the event, the Rural Bankers Association of the Philippines-Microenterprise Access to Banking Services (RBAP-MABS) program presented the use of new mobile technology for microenterprise.

In 2004, the RBAP-MABS Program started the mobile phone banking services initiative to increase access to financial services and promote economic growth by collaborating with existing major mobile money platforms namely, Globe’s GCASH and Smart Money. Factors such as the issuance of circulars 649 and 704 by the Bangko Sentral ng Pilipinas created favorable regulatory environments, technological developments and rapid expansion of mobile phone subscribers among microentreprenuers and low-income households paved the way of using mobile phones to do banking. Clients and customers can now pay loans, make deposits and withdrawals, and remittances with the use of a mobile phone.

MariaDuring the presentation, the story of Maria was used to illustrate how mobile phone banking services benefit microenterprise clients (See video). Like most of bank clients, Maria wants to save time and money by not having to go to the bank to do banking transactions. Mobile phone banking services enable clients to transact with the bank remotely.  A borrower can pay his/her loan amortization through Text-A-Payment while a depositor can utilize Text-A-Deposit and Text-A-Withdrawal to deposit or withdraw money from their savings account. Clients are thereby able to save time and transportation costs, as well as build up their savings in a flexible and timely manner.

As of the end of September 2011, RBAP-MABS with support from Globe Telecom’s G-Xchange Inc. has helped accredit more than 1,100 participating rural banks to offer mobile phone banking services benefiting over 311,000 clients while processing more than PhP12 billion (US$275 million) in mobile phone banking transactions since 2006. Included in these figures are over 100,000 recipients of the Philippine government’s conditional cash transfer program called Pantawid Pamilyang Pilipino Program (4Ps).

With mobile phone banking initiative, rural banks are providing greater access to banking services to more remote clients than previously served by the banks.