Mobile Commerce Summit Presentation

Rural Banks Leveraging Mobile M ney to Increase Access to Banking Services

5th Mobile Commerce Summit 2012 Fullerton Hotel, Singapore 03.21.2012

Roselle M. Hernandez Mobile Phone Banking Specialist RBAP-MABS Program, USAID

TheMABSProgram

TheMicroenterpriseAccesstoBankingServices(MABS)Programis

anRBAPprogramsupportedbyUSAIDthatprovidestechnicalassistanceandtrainingtoruralbanksinmicrofinance

bestpracCces.Itisdesignedtodevelopthecapability

ofruralbankstoprofitablyprovidefinancialservices‐loans,deposits,

insurance,moneytransfersandmobilebanking‐formicroenterprise

clients.

Indicators

Status:Dec2011

#Banks&Branches 100/1,300

#Micro‐LoansDisbursed 3M

#Micro‐Borrowers 950,000

Amt.LoansDisbursed $900M

#Micro‐Depositorsmanaged

1.4M

#Microinsuranceclients 450,000

TheRuralBanks…

LUZON

VISAYAS

MINDANAO

Most rural areas have limited access to financial services.

Rural banks are ideal Financial Institutions to facilitate access to banking services for rural and lower income individuals.

There are 600 rural and cooperative banks throughout the Philippines with over 2,700 branches/units serving more than 85% of all municipalities.

MobilePhoneSubscribers

(WorldProjecCons)

2011(ITU):4.6Billion

2012(ITU):5.6Billion

MobilePhoneSubscribers(Philippines)

>90%penetraConrate>90millionsubscripCons

MobilePhone

Subscribersvs.BankAccts(Philippines)

Philippines:“TextCapitaloftheWorld”

1998 2011BankAccts >23M >34MMobileSubs>1.7M >90M

MobilePhoneIndustry

GrowingsubscriberSCffcompeCConreducingcostsAffordablehandsetsGrowingmobilemoneyplaforms(GCASH/SmartMoney)

OpportuniCesfortheuseofMobileMoneythroughRuralBanks

RemiianceBusiness

GrowinginternaConalremiianceatPhP20Bfor2011DomesCcremiiancesTransfermethodsincreasinglyusingMobileMoney(GCASH/SmartMoney)

RuralBanks

>40%ofpopulaConintheruralareasRuralbankshave2,700branches&otherbankingofficesMoCvatedasanindustrytogrowtoscale

PreparingRuralBanks&MFIstoPromoteMobileMoney&MobileFinancialServices

MobilePhoneismorethanjustaPhone…

WithMobilePhone,youcannow…

ReduceCost

GreaterEfficiency

ImprovingOutreach

IncreaseDeposits

TheBusinessModelforRuralBankstoofferanduseMobileMoney

PilotTests:IssuesandLessonsLearnt

Acceptanceandfearoftheuseof

technologyespeciallyamongelderlyclients

LackofMobileMoneyOutletsorsource

especiallyintheruralareas

Howtoreachclientsinremote

communiCes‐awarenessand

informaConcampaign

ValueProposiConforClients,Merchants&

Customers

WorkingwithNetworksofMFIs(RuralBanks)–canbekeytooutreach

Increasingofvolumeandusageofmobilemoneyintheruralareas.

OvercomingCash‐in/Cash‐outConstraintsinRuralCommunity

LarryBat‐ao,CanClanBankMerchant‐DepositandproviderofGCASH

BankidenCfiedLocalMerchantsand

assistedthemtobecomeMNO

licensedMobileMoneyAgentsin

ruralcommuniCes

RuralBankGuidelinesforSelecCngMerchantsasMobileMoneyAgents

 Depositor AcCveGlobeSIM RegisteredtoGCASH Stablebusinesswithsufficientcashflow WillingtoservebankclientswithintheareaandtofollowKYCrequirements

 Willingtofollowstandardprocedure&transacConfees

 WillingtocomplywithMobileMoneyIssueraccreditaConprocess

OvercomingCash‐in/Cash‐outConstraintsinRuralCommunity

Bankestablishedkiosks,sub‐offices,andotherbusinessoffices(OBOs)to

provideCash‐InandCash‐Out

OvercomingCash‐in/Cash‐outConstraintsinRuralCommunity

Know‐Your‐Customer(KYC)Challenge

Challenge: NeedtosimplifyKYCinruralareas

ProposedSoluMons: StandardizedID/ATMCardissuedbytheruralbanksinpartnershipwithGXI–FaceCard

 FaceCardusedforKYC FaceCardmayalsobeusedfordiscounts,perks,promos,loyalty,etc.

DevelopingMobileMoneyEcosystemsCommitmentofBankManagement

DevelopmentofMobileMoneyEcosystemSufficientCash‐In/Cash‐OutAgents/Resellers

CreaCngAwarenessoftheuseofMobileMoneyPromotethevalueproposiConforbusinesses,clients,andcustomers

Thank Y u! 5th Mobile Commerce Summit 2012

Fullerton Hotel, Singapore 03.21.2012

Email: rhernandez@rbapmabs.org

Websites:

www.rbapmabs.org www.mobilephonebanking.rbap.org

www.youtube.com/RBAPMABS