Lessons from Basa Pilipinas adoption of m

Report
Lessons from Basa Pilipinas
adoption of m-money payment
April 2014
Manila, Philippines
USAID Philippines’ mobile payment initiatives
•
Actively works to develop mobile money via two projects.
–
–
Microenterprise Access to Banking Services (MABS) Project
Scaling Innovations in Mobile Money (SIMM) Project
•
Supports the Government of the Philippines’ participation in the Better
Than Cash Alliance (BTCA)
•
Supports the Better Than Cash Initiative. Worked to Include “hortatory
language” to encourage use of electronic payments in all of the
Mission’s grants and contracts
SIMM Project
About Scaling Innovations in Mobile Money
•
2-year program funded by USAID which started in April 2012
•
Objective is to increase financial inclusion with two inter-connected
goals:
1.
Boost expansion and rapid adoption of mobile money (m-money) services
2.
Create an enabling environment for m-money
•
Agreed between Pres. Aquino and USAID Administrator Rajiv Shah in
June 2012 in Washington, DC
•
Supports GPH objective of inclusive growth in the Philippine
Development Plan
•
Supports USAID objectives for Partnership for Growth
•
Working with LGUs and MFIs to use m-money to:
o
o
Disburse payroll, grants and loans to over 250,000 people
Collect taxes, fees and loan amortization
Basa Pilipinas Program
About Basa Pilipinas (Read Philippines)
•
A four-year program funded by USAID which started in January 2013
•
The program aims to support the Department of Education (DepED)
toward improved reading proficiency for up to 1 million early grade
students through:
1. Improved Reading Instruction
- Train grades 1-3 teachers and school heads on effective reading instruction
in Mother Tongue, Filipino and English
2. Improved Reading Delivery Systems
- Work with DepED to set national reading standards and develop appropriate
assessment tools
- Support Community Awareness Raising efforts aligned with core programs
3. Improved Access to Quality Reading Materials
- Develop and distribute appropriate reading and instructional materials
- Engage private partners to provide supplementary reading materials
Basa & SIMM synergy
Basa wanted to increase operational efficiency and ensure the safety of
administrative staff during the preparation and distribution of cash
reimbursements to teacher participants.
SIMM with its success in piloting m-money cash disbursement for LGUs and
cooperatives provided Basa with an overview of m-money disbursement
options in the Philippines and introductions to each provider. SIMM also
described their own processes and lessons learned to Basa.
Basa designed a process, informed by SIMM’s experience, to distribute travel
reimbursements to more than 2,000 teachers in La Union and Cebu. Plans
are in progress to reimburse more than 8,000 teachers in the month of May
during summer professional development for teachers in Regions 1 and 7.
To ensure that teachers are supported throughout the reimbursement process,
Basa also utilized frontline sms to send text blasts to teachers. Through text,
Basa was able to troubleshoot payment issues, survey teachers’ reactions to
the technology, and offer opportunities to answer questions.
Cash handling pain points
Consumer
• Risk of theft
– Physical cash is exposed to risk of
theft
• Access
– Savings services are not easily
accessible
Institution
• Costly
– Transportation and insurance cost for
manual handling of cash from bank to
office/recipients
• Operational inefficiency
– Manpower costs
– Human error in counting cash
– Time consuming
• Risk of theft
– Manual handling of cash poses threat of
theft or leakage
M-money benefits
Consumer
• Convenience
– Can transact anytime, anywhere
– Can withdraw in over 10,000 Bancnet / Megalink
ATM and over to 12,000 cash merchants
nationwide
• Cost-Effective
– Cheapest way to send money to family and friends
– Gives 10% rebate on purchase of pre-paid airtime
credits
– Can save on transportation cost and opportunity
costs in making bills payment
• Secure
– Requires M-pin
– Generates electronic receipt as proof of transaction
– All transactions have electronic records
• Easy access to savings services
– Mobile wallets can be linked to savings accounts
Institution
• Cost-Effective
– Eliminates paper work
– No ADB or maintaining balance required
– Eliminates cash handling costs
• Efficient
– Streamlines back-end process for disbursement
– Quicker and more accurate management
reports
• Secure
– Requires two step approval (maker and approver)
– Transaction logs are easily accessible from web
portal
• Transparent
– All transactions have electronic trail
• Promotes Transparency and Accountability
– Minimize misuse of funds as payments are credited
directly to bank account—no manual handling of
cash
Mobile Money Providers
M-money providers (MMP) in the Philippines
•
MMPs presented their respective m-money disbursement products to Basa, after which Basa selected BPI Globe
BanKO’s product
•
BPI Globe BanKO is a virtual bank with its mobile wallet linked real-time to a savings account
•
Basa and BPI Globe BanKO signed a partnership agreement to implement the project
•
•
BPI Globe BanKO provided Basa with:
- training on disbursement using BanKO’s web access
- 2 batches of end user trainings
- 2,000 Globe sim cards
- 2,000 ATM cards
With savings resulting from lower cash handling costs, Basa is able to subsidize cost of cash-out and ATM withdrawal
fees for teachers
Payment of reimbursement prior to mobile money
•
For a 3-day Basa training for up to 500 teachers, manual cash disbursement
required a minimum of 5 finance staff on site working for a total of 250 man-hours
(5 days at approximately 10 hours per day) to take care of the following tasks:
- Withdrawal of funds from banks in small currency
- Counting of money for each participant after review of claims and filling envelopes
- Distribution of funds to teachers
- Liquidation of all funds received
- Other admin/finance tasks such as distribution, collection and review of transportation
claims, verification of attendance
With mobile money cash disbursement
For a similar training (3 days for up to 500 participants), on site finance staff
requirements have been reduced to 2 staff working 5 ten-hour days, for a total of 100
man-hours for mobile money payment processing, including other admin and finance
tasks. The security risk is eliminated as staff no longer travel to remote locations with
large quantities of cash.
Process Flow
Account Opening (One-Time Process)
Submit
application
form
Teachers
Deliver SIM
and ATM
To Basa
Submit to
application
Basa/MMP
for activation
Mobile
Money provider
Distribution
of ATM & SIM
Basa
Teachers with
Mobile Money
Process Flow
Disbursement (Recurring)
Submit
Expense
Report
Technical
Approve
disbursement
Through MMP
Web Access
Teachers with
Mobile Money
Submit
Verified
Report
Finance
Upload account number
and amount to disburse
to Web access of MMP
COP
Lessons Learned

Stakeholder consultation is crucial prior to switching to m-money payments to avoid resistance
in adoption.

The program should make it clear to the MMP early on about the potential scale of the service
required in terms of no. of payees, frequency of disbursements, and amount of payments for
easier appreciation of the business case by the MMPs. Depending on the scale, the program
can negotiate better deals.

Program should give sufficient lead time from contracting period to actual implementation. This
is usually 1-2 months, depending on the MMP.

Program should conduct pre-activation with MMP prior to program training or event to fully
accommodate the volume of beneficiaries. Pre-requisites include complete and accurate data
of beneficiaries for m-money account opening purposes, and adequate mobile network signal.
Internet access is also preferable.

MMP should customize end user training according to beneficiaries’ needs, i.e. highlighting best
savings interest rate in the market to drive interest in the other m-money services available.

Ensure after-sales support is well-established by the MMP and that other actors, i.e. DepEd
superintendents, are also informed or trained about the service.
Quote
“The use of mobile money is amazing. We didn’t face danger
anymore in carrying cash, and we no longer count money and
place them in envelopes. We also incurred savings because of
minimized involvement of support staff.”
Loreta Villones, Finance Manager
Basa Pilipinas Program
Activities
Public school teachers participating in a Basa
Pilipinas training learn how to use a BPI Globe
BanKO account in Cebu City on February
2014. Basa Pilipinas Program and SIMM
Project are partnering to make disbursement of
travel reimbursement of teachers more
efficient and convenient through mobile
money.
Thank you
For more information, please contact:
Basa Pilipinas Program
SIMM Project
Mr. Lee Marshall
Deputy Director
Office of Education
U.S. Agency for International Development
Annex 2 Building, U.S. Embassy
1201 Roxas Boulevard 1000
Ermita, Manila
Email: [email protected]
Ms. Maria Teresita Espenilla
Project Management Specialist
Office of Economic Development and Governance
U.S. Agency for International Development
Annex 2 Building, U.S. Embassy
1201 Roxas Boulevard 1000
Ermita, Manila
Email: [email protected]

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