Mobile Phone Banking Presentation at Chemonics


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This slideshow on private partnerships to facilitate mobile phone banking services for low-income households in the Philippines was presented at Chemonics International on January 30, 2009.

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Mobile Phone Banking Presentation at Chemonics

  1. 1. Developing Private Partnerships to support Mobile Phone Banking Services for Low Income Households in the Philippines JOHN V. OWENS CHEMONICS INTERNATIONAL JANUARY 30, 2009
  2. 2. Country Context: Philippines •  Population: 90 million •  Rural Population: 50% •  Per Capita GNI: $1,671 •  Pop. In Poverty: 30% •  Annual Remittances: $16 B •  Mobile Phone Subscriber Base: 66 M •  # of Mobile Phones per 100 people: 73 INSERT MAP OF THE PHILIPPINES
  3. 3. 0  10  20  30  40  50  60  70  1998  1999  2000  2001  2002  2003  2004  2005  2006  2007  Est  2008  Bank Accounts  Mobile Phone SubscripAons  Bank Accounts vs. Mobile Phone  Subscrip8ons  Philippines (in Millions)  Microenterprise Access to Banking Services
  4. 4. Rural Banks in the Philippines •  Wide network coverage: –  700 rural banks with 2,100 branches •  Over 50 year history •  Over US$3.5 billion in assets •  Over 6 million deposit accounts •  Over 1.5 million borrowers
  5. 5. What is the MABS Program? Microenterprise Access to Banking Services
  6. 6. Mobile Phone Banking and E-Money (How it Works) Microenterprise Access to Banking Services Program
  7. 7. Challenges for Banks to reach Rural Clients High Transaction Costs –  Transportation Cost –  Time time –  Loss of business opportunity –  Security risk
  8. 8.  E-Money  E-Money Creating Opportunities to meet the Challenge Use of E-Money Reduces Transaction Costs - No transportation cost - Fast - Secure no cash in transit
  9. 9. Microenterprise Access to Banking Services Program Today, Rural Banks Can Offer Following Mobile Phone Banking Services… Clients Receive Loans Loan Payments Deposits Withdrawals Reload Airtime Send Money (Remittances) Bill Payments Receive Payroll
  10. 10. Benefits of Branchless Banking (Along the Value Chain) E-money Merchants and Resellers Increase walk-in traffic Revenue from fees Ability to accept electronic payments Client Banking anywhere, anytime Save time and money Safe and secure Bank Leverage Merchants, Resellers and Mobile Phone subscribers to expand client base Efficiency and savings on operating costs Increase deposit levels Microenterprise Access to Banking Services Program
  11. 11. Private Partnerships & Strategic Alliances to provide increased access to banking services for low income households Microenterprise Access to Banking Services Program
  12. 12. Microenterprise Access to Banking Services Program Breakthroughs & Milestones: With Partners 2004-2005 RBAP signed an MOA with Globe (GXI) for Loan Payment using Gcash BSP approved pilot of Text-A- Payment to selected rural banks Autoloadmax retailers as Gcash outlets was launched Study on Cost Savings conducted to selected rural banks on the use of Gcash for loan payment 2006 Some RBs started paying employees salaries or allowances with Gcash M-commerce was used by local merchants BSP approved Cash-in/Out (Text-A-Remittance) services for rural banks BSP approved Text-A-Deposit service for rural banks Strategic Planning was conducted with 5 pilot banks
  13. 13. Microenterprise Access to Banking Services Program 2007 Text-A-Sweldo service expanded to other businesses in the community Text-A-BillPayment was initiated by a rural bank with local utility cooperative Text-A-Withdrawal was approved by BSP Mobile Phone Banking Specialist Program was launched 2008 More than 70,000 new users & 3,500 local merchants Mobile Phone Marketing program launched 45 rural banks with more than 650 branches and kiosks are accredited RBAP and Globe (GXI) partnership renewed RBAP signed an agreement with Nokia Philippines (Nokia phone financing and promotional materials) RBAP Signed an agreement with Smart Communications (Smart Money) Agreement with MyClick Breakthroughs & Milestones: With Partners
  14. 14. PRODUCT DESCRIPTION CLICKSOFTWARE® SMS Gateway System is a software solution that enables you to send and receive SMS and short messages over a cellular network and connect to computerized database. The system is a plug-and- play application that instantly enables your computer to send out SMS messages. The system is also capable of extracting data from your database via parameterized text messages for two-way automatic messaging to be sent back to the requesting party.
  15. 15. BALANCE INQUIRY BAL ON ACCOUNT 1234567 Send message to bank messaging number THE BALANCE ON ACCOUNT NO. 1234567 IS PHP 3023.50 LOCATION WHERE APPLICATION IS HOSTED 1 2 3 4 5 6 SMS will be received by the SMS Gateway System and process Extract info from the database Converts back data to SMS to send back to inquiring party Telco receives SMS Inquirer will receive the info demanded
  16. 16. AUTOMATIC ANNOUNCEMENT OF LOAN APPROVAL/DISSAPPROVAL BANK 1 From Acme Bank: Mr. Santos your loan was approved, please contact 543-1234 for details. System periodically check loan database for status approve, when approved it will send a predefined SMS message to the customer using the customer database 2 Telco receives SMS 3 Customer receives the notification of loan
  17. 17. Bank Case Study: PR Bank’s Implementation of Mobile Phone Banking •  32 branchesNo. of Branches & Kiosks •  Over 137,000 transactions •  Totaling P709.8M ($16M) M-Banking Transaction Volume 2008 •  110No. of Registered Merchants •  2,940 clients •  1,940 employees •  Walk-in Clients No. of Registered M-Banking Clients Microenterprise Access to Banking Services Program
  18. 18. Implementation of Text-A-Sweldo Payroll Servicing through GCASH in CEZA •  Cagayan Economic Zone Authority (CEZA)Client Name •  PR BankBank •  2008 Using MPB since •  Text-A-Sweldo (TAS) •  Serving almost 1, 000 employees MPB Services Microenterprise Access to Banking Services Program
  19. 19. Microenterprise Access to Banking Services Program Bank Case Study: The growing mobile ecosystem of Cantilan Bank • 12 • (Surigao areas)No. of Branches • P112.8M ($2.5 million) • (Jan to Dec 2008) Amount of Transaction Volume • P435,900 ($9,900)Mbanking Fee Income • 644No. of Registered Merchants • 13,700No. of Registered M- Banking Clients Surigao del Sur II Electric Cooperativ e
  20. 20. M-BANKING TRANSACTIONS CANTILAN BANK 2009 1551  1422  1588  2165  1855  2302  2796  2223  2784  2434  2741  2468  0  500  1000  1500  2000  2500  3000  0  2000000  4000000  6000000  8000000  10000000  12000000  14000000  16000000  Jan.  Feb.  Mar.  Apr.  May  June  Jul.  Aug.  Sep.  Oct.  Nov.  Dec  Total  TransacAons 
  21. 21. Amount of M-Banking Transactions by Type
  22. 22. John Owens Visit our website: Mobile Phone Banking installations Nationwide Microenterprise Access to Banking Services Program