Pushing mobile banking to the limit (First of two parts)

THE popularity of cell phones in the Philippines is undeniable and palpable. Ask any person on the street if he has a cell phone, and 7 out of 10 would probably say yes.

Sadly, while access to mobile phone services has rocketed in recent years, access to financial services remains a major barrier to economic growth.

If only banks here were as easily accessible as cell phones, particularly in the rural areas!

However, there is a very promising project that aims to offer an “innovative and cost-effective” means to benefit the marginalized sector -- particularly the “unbanked.”

The Scaling Innovations in Mobile Money (SIMM) Project, as it has been “christened,” will build upon an earlier United States Agency for International Development’s (USAid) project called Microenterprise Access to Banking Services or MABS. MABS–a joint project with the Rural Bankers Association of the Philippines (RBAP)-helped initiate current interventions in mobile banking.

SIMM intends to push the boundaries further through new technologies toward building a truly inclusive financial system.

Last September 11, 2012, USAid representatives met with front-liners in mobile banking in a meeting hosted by the Bangko Sentral ng Pilipinas.

Present during the event were Dr. Maura O’ Neill, USAid Chief Innovation Officer and Senior Counselor to the Administrator; Ms. Gloria Steele, USAid Philippines Mission Director; Ms. Tessie Tan, President of BPI-Globe BanKo; Mr. Paolo Baltao, President of G-Xchange; Ms. Tricia Dizon, Financial Services Head of Smart Communications, BSP Deputy Governor Nestor Espenilla and this writer.

It was truly a momentous occasion. After all, it is not every day that we see known mobile service competitors sit at the same table to engage in a joint undertaking!

We have actually seen the initial successes of “e-money” in the Philippines through MABS.

E-money has been used locally for simple transactions such as bills payment, person to person transfers, and purchase of goods.

It has also been used for deeper financial transactions as a “channel” to deposit, withdraw, or service loans, as well as receive conditional cash transfers.

For providers, e-money has helped them overcome physical barriers and address “cash on hand” risks.

Just a few months ago, I had the honor of providing the keynote message during the 15th Anniversary of the Microenterprise Access to Banking Services (MABS).

During that occasion, I witnessed the program’s recent achievements in bringing mobile banking to clients and areas that are difficult to reach through traditional “brick and mortar” bank offices.

Indeed, through the MABS program, the rural banks seized the many opportunities provided by an enabling policy and regulatory environment to bring financial services to areas that needed them the most.

Much still needs to be done, though. We still hope to see volumes of transactions and numbers of users multiply.

The SIMM Project, which aims to build on the gains accumulated for over 15 years through the MABS program, can provide the impetus for our e-money and mobile money transactions to reach that proverbial “tipping point” -- a point that will enable a greater number of Filipinos to conveniently, efficiently and effectively access much-needed transactional and financial services.

(To be continued next week)

Note: You may email us at totingbunye2000@gmail.com. Past articles may be viewed at http://speakingout.ph/speakingout.php.