PHL gets high marks in mobile finance survey

Confirming its status as one the world’s most vibrant mobile markets, the Philippines scored high marks in the “Mobile Financial Services Development Report 2011" released by the World Economic Forum (WEF) on Tuesday. The report cited the Philippines, along with Kenya, as among the few countries that have achieved adoption levels of more than 10 percent of the total adult population. “A defining characteristic of these countries is a dense network of agents – retail access points that are capable of registering account holders and handling cash transactions," the study said. The report analyzed over 100 variables across 20 countries in Africa, Latin America, and Asia. Developed in conjunction with The Boston Consulting Group, the report measured the critical factors necessary to achieve meaningful scale of mobile financial services. Despite the broad recognition that mobile financial services can serve as a means for “banking the unbanked" on a global basis, wide-scale adoption has yet to be achieved, according to the report. The report highlighted that the adoption of mobile financial services is currently confined to a few countries where access to financial services has been historically constrained and the scope of services limited to mobile money transfer. The findings also suggested that the adoption of financial services such as savings, credit, and micro-insurance are nascent and that regulatory environments, market competitiveness, and the financial literacy of end-users all need to be collaboratively addressed before meaningful scale can be achieved. “The potential for the mobile platform to inclusively transform the financial lives of individuals and the structures of industries is unquestioned," said William Hoffman, head of the telecommunications industry at WEF. “What’s needed is the evidence and collective intelligence for navigating the complexity of the mobile finance landscape. This report serves as a tool for decision-makers in that regard." “Mobile technology provides unprecedented opportunities to reach poor and unbanked populations in places where traditional financial services have not historically thrived. The challenge for policy-makers in developing countries is to find ways to free these new channels to the poor while also maintaining a safe and secure national financial sector," said Alfred Hannig, Executive Director, Alliance for Financial Inclusion (AFI). The Philippines scored relatively well in “readiness", with the report attributing this to the fairly mature nature of the country’s mobile financial services deployments. “The Philippines has explored the implementation of mobile financial services for a relatively long time and has realized high levels of adoption and a wide array of available services," the report said. The report cited the Philippines government, “which has shown leadership by using mobile financial services to distribute social payments and collect taxes." “Its robust performance in the other pillars within the institutional and market environment seems to indicate a high level of ‘readiness’ to continue this leadership," the report said. “The Philippines has managed to build a dense agent network which may be a key asset for the provision of an even broader range of services in the future. The relatively large volume of incoming remittances that are sent home by Filipinos abroad can potentially be a driver to achieve further scale," it added. — Newsbytes.ph