Rizza Maniego Eala G Cash

GCASH Enabling Better Access to MicroFinance

24 July 2008 Rizza Maniego-Eala

1

Non-Traditional m-Banking Opportunity The Philippines is geographically fragmented; substantial portion of population in remote rural areas z 80% of the Philippine population remains unbanked / underbanked often traveling far to make a simple financial transaction z Commercial banks still have very limited reach to remote areas -----------------------------------------------------------------z Over 62M mobile subscriptions z Mobile network infrastructure and distribution system are well developed even in the remotest areas z The average mobile user is accustomed to loading and sharing airtime credit over-the-air and is comfortable with mobile phone’s security features -----------------------------------------------------------------z Globe has high transaction processing capability z Globe has well developed sales force and business development capability across the Philippines z

2

Globe utilizes its m-commerce platform to address the remote payment requirements of micro-finance activities Hypothesis: If the micro-finance community embraces mobile commerce or mobile banking in a big way, we can reach more poor people in the rural areas with financial services products such as: Savings Loans Insurance Remittance Bills Payment

3

Award-winning Mobile Wallet Service… Loan Payments to Rural Banks & Coops

Merchant Payments

Remote prepaid Re-loading

Money Transfer

Bills Payment

Domestic / International Remittances 4

Answer to Opportunity : GCash What is GGash?

• Transforming a mobile phone into a wallet, enabling subscribers access to a cashless and card-less method of facilitating money transfer with just a text message • Enable remote payments

What GCash can do and Cash cannot?

• Pay bank loans w/out going to bank • Pay bills without lining up • Pay for food / services from anywhere • Send remittances

All you need is a mobile phone and SIM Instant money transfer via text message costing only P1.00 or U$0.02 5

Central Bank and AMLA Compliant “…GCash is virtual cash that is better than actual cash, because the system leaves a trail for the Anti-Money Laundering Council, the Bangko Sentral ng Pilipinas, and other regulatory and law enforcement agencies to follow. Atty. Vicente S. Aquino, Executive Director: Anti-Money Laundering Council Secretariat, Presentation to APG, Singapore, June 2005

Anti Money Laundering Council Central Bank Know-Your-Customer (KYC)

Subscribers – 1 time registration and valid ID

Merc hant s

Merchants

• Monetary Board Resolution no. 116 in Jan. 2005

• U$ 2,000/month

-Duly accomplished accreditation forms w/ necessary licenses Systems Controls - Reporting of “covered”/suspicious transactions

• Periodic audits in the Business Processes and the Systems/Security 6

…that has expanded into a Platform •

More than 1.5m users

•

Available in over 800 international outlets in 25 countries

•

Accepted in 6,000 domestic outlets in the Philippines

•

1,500 exchange outlets comprising of Rural Banks, Pawnshops, Telco Counters, and FX outlets (all with government issued remittance licenses)

•

Spurred a wave of new approaches and applications in Micro-Finance and MicroPayments

Worldwide Presence

7

Microfinance Use Case: Rural Bank Centric Ecosystem Intl. / Dom Remco’s

P Rural Bank / MFIs

Text-a-Sweldo (Salary Disbursement)

P2P (Domestic Remittance)

Cash-In (Face-to-Face Wallet Funding) *Also possible from Cash-in Partners

GCash2Load (Airtime Credit Purchase)

Text-a-Withdrawal (Withdrawal from Bank Account to GCash Wallet)

P2P (Purchase of Goods /Services)

Text-a-Credit (Loan / Credit Disbursement)

Text-a-Payment

P

Text-aBillPay (Bills Payment)

(Loan/Credit Repayment) Text-a-Deposit (Deposit to Bank Account) 8

Text-A-Payment

There is strength in RB/MFI - Telco Synergy TELCOs: z Expansion of Telco Revenue Stream z Creation of a more robust platform around its core merchant ecosystem (mobile subscribers and various retailers) z Providing an alternative and low-cost infrastructure to banks and customers RB / MFIs: z Additional value proposition to customers z Alternative solution at lesser or even close to zero capex z Ability to expand distribution channel at lower cost which they may pass on to consumers BORROWERs: z Better access to micro-finance at lower borrowing or 16 maintenance costs

CGAP and Gates Foundation supporting GCash in building ecosystems ƒ Spur mini-ecosystems in low-income / rural provinces in the Philippines with large unbanked population using GCASH ƒ Project objectives: ¾ Extend access to financial services in rural areas ¾ Improve access to money transfers and payment services ƒ Learning objectives: ¾ What approach extends the frontier of delivering financial services in Philippines? ¾ Is the approach financially viable? ¾ What strategies and programs need to be 17 implemented?

End Presentation 24 July 2008 Rizza Maniego-Eala

18

Cash In to P2P Demo Video