Smart, PlaNet Finance bring mobile banking services to Leyte

MANILA, Philippines - The mobile banking pilot project of Smart Communications Inc. in the province of Leyte has affirmed the Filipinos’ readiness for mobile phone-driven financial services. 

Dubbed as the Banking the Unbanked (BTU) project, this is the country’s first cohesive attempt to provide branchless, cashless banking services to the countryside, using one of the most ubiquitous tools of today – the mobile phone.

 The PlaNet Finance Group implemented the program through its subsidiary, mBank Holding (MBH), in partnership with Smart to benefit members of the low income market who otherwise have little or no access to formal banking services.

 PlaNet Finance Group is an international non-profit organization which mission is to alleviate poverty by providing access to financial services to the unbanked and underbanked, in particular to micro and small entrepreneurs. mBank Holding is a subsidiary of PlaNet Finance Group, created jointly with FMO & Finnfund, two development finance institutions with a long track record in supporting emerging markets particularly in the field of access to finance. 

PlaNet Finance and mBank Holdings co-founder Arnaud Ventura said that the project was launched to let members of the underserved sector enjoy the full range mobile banking services despite their geographical and income limitations. 

“We are happy that our efforts have helped revolutionize mobile banking services in the countryside,” Ventura added.

The 18-month pilot utilized Smart’s award-winning Smart Money platform to provide mobile-based financial solutions such as micro-savings and micro-loan services to a test market of Smart and Talk ‘N Text subscribers composed of farmers, airtime retailers, market vendors and other low-income earners, who remitted capital build-up deposits and loan amortizations using their Smart mobile phones. 

What sets the BTU apart from other mobile-based initiatives is that all transactions – from Know Your Customer (KYC) processes, account activations, capital-build ups, loan disbursements and collections-happen over-the-air (OTA).

 It is secure, cashless and paperless mobile banking in its truest sense, made possible by Smart Money’s menu-based financial solutions such as micro savings and micro loan services. Once launched commercially, the offerings of the BTU project will be rolled out to different locations in the Philippines, and potentially, other countries. 

Smart financial services head Tricia V. Dizon said that BTU has a huge potential to benefit Smart’s predominantly prepaid market, many of which have limited access to formal banking services. 

As of June-2012, Smart has 50.9 million subscribers on its GSM network, about 98 percent of which are prepaid. This is supported by Smart’s extensive and modern digital communications infrastructure – covering all of the country’s 1,629 cities and municipalities. 

“The pilot demonstrated a demand for accessible and easy-to-use financial services that will allow subscribers to save in an account, transfer money, receive funds, reload airtime, and pay loan amortizations. The pilot also demonstrated the importance of having a reliable and extensive network to make such an effort successful,” Dizon said. 

The BTU Project complements other Smart offerings that provide seamless and efficient mobile commerce and banking solutions to the unbanked sector. Smart Money is currently being utilized to disburse loans for airtime reloading to microentrepreneurs under the Hapinoy program.