Ideas & Updates

Mercy Corps recognized for providing emergency e-transfers to 25,000 Typhoon survivors in the ‪‎Philippines‬ ‬‬‬‬‬

© S. Fitzgerald / Mercy Corps

Beneficiaries received electronic transfers via mobile savings accounts

Destroyed Home Typhoon Yolanda

The home of Florida and Realino Go was partially destroyed during Typhoon Yolanda. This was the pilot beneficiary site for the Mercy Corps and BanKO cash transfer program on Leyte Island (April 2014).

In November 2013, Typhoon Haiyan, a strong tropical cyclone, struck the Philippines, causing the loss of over six thousand lives, and destruction of property and livelihoods. The country had witnessed its deadliest typhoon – those who survived the cyclone needed assistance as soon as possible.

Mobile technology to the rescue

Time was of the essence – so to deliver financial assistance as soon as possible, the TabangKO program was created by the global humanitarian and international development organization Mercy Corps, a Better Than Cash Alliance member, and BPI Globe BanKO, the Philippines’ first mobile micro-savings bank. Through the program, 25,889 typhoon-affected households received electronic transfers through mobile savings accounts.

Recently in March 2015, both organizations were recognized for their efforts with GSMA’s 2015 Global Mobile Award for “Best use of Mobile in Emergency or Humanitarian Situations.” In conferring the award, the GSMA judges said the TabangKO program was “well designed and executed, and differentiated with the addition of educational financial content to help improve longer-term development goals.”

The TabangKO story: Reaching over 25,000 typhoon-affected households

Tablets Registering Recipients

Mercy Corps and BankO staff work to register recipients using e-tablets in the village of San Pedro in Leyte, Philippines (April 2014).

Mercy Corps and BPI Globe BanKO used mobile technology to distribute $2.3 million in emergency financial assistance to 25,889 typhoon-affected households in Western, Central and Eastern Visayas regions of the Philippines. This timely delivery of assistance was coupled with financial literacy messages and the design of a loan and bundled insurance product specifically targeting disaster-affected households.

Beneficiaries of the program were enrolled in BanKO’s mobile savings accounts, through which they received three separate electronic cash transfers, totaling 3,950 Philippine Pesos (about $90). All recipients received the same amount of cash; however, as part of an impact evaluation, some received the money in a one-time transfer and others split over three transfers over eight months.

Recipients were provided a Globe Telecom SIM and an ATM card as part of account activation. As a mobile-only bank, BanKO does not have branch offices and relies on an agent network for clients to cash-in and cash-out using their Globe-branded SIM.[1]

With a goal to open one million saving accounts by the end of 2014, TabangKO was an opportunity for BanKO to expand its client base. For Mercy Corps, it was an opportunity to further explore the use of e-transfers in emergencies rather than traditional physical cash transfers, as well as to link basic financial literacy with emergency and recovery cash transfer programming.

Livelihoods loan product

BanKO is currently pilot testing an emergency livelihoods loan product, called KabilinKO, which has built-in one-year insurance coverage, among both TabangKO recipients and others affected by Typhoon Haiyan. The loan product was designed as part of a rapid, human-centered design product process in the affected geographic regions.

In December 2014, BanKO earmarked Php 10 million (more than USD $227,000) as part of the bank’s strategy in supporting innovative loan product development and, in particular, for the rollout of KabilinKO and incubation of similar loan products for disaster-affected households.

Finally, Mercy Corps shared two 13-part ‘soap opera’ style financial literacy messages with 21,182 TabangKO beneficiaries using interactive voice recordings and SMS text-based messages. The stories highlighted two important financial concepts – saving and planning. The stories followed the conversations of a young married couple, Ben and Joy, who discuss tough financial decisions as they plan a budget for their household expenses.

Evaluation of the program impact

Mercy Corps TabangKO Typhoon Haiyan

An image from a trip to assess the Mercy Corps TabangKO mobile cash transfer system to aid survivors of Typhoon Haiyan (January 2014).

Mercy Corps is currently conducting an impact evaluation of the TabangKO program. Through randomization and rigorous quantitative and qualitative analysis, Mercy Corps will better understand the linkages between emergency electronic transfers and meaningful financial services in recovery.

The research will provide insights on the following:

  1. The impact on from the frequency and values of cash transfers.
  2. The influence of financial education messaging on savings behaviors and the uptake and repayment of loans.
  3. The impact on finance related messages and reminders on savings behavior.

Some initial insights include:

Low Digital Literacy: BanKO and Mercy Corps underestimated the digital skills of the e-transfer recipients in the rural areas hit by the Typhoon. The concepts of a PIN and an ATM card were new to the recipients. BanKO had some existing clients in the geographic areas but the majority of BanKO clients were urban-based and more technologically savvy than in the more rural impacted geographies.

No Account Interoperability: BanKO accounts cannot be directly linked with the popular G-CASH mobile money wallet. BanKO accounts and G-CASH both use SIMs from the Globe mobile network but they currently cannot be linked nor transfers made between the two accounts. This has limited usability and has been a disincentive for recipients to retain money in the BanKO account.

Incentive to hold value in BanKO account: BanKO was not aggressive in incentivizing the e-transfer recipients to retain money (i.e., hold or store value) in the savings account. Once they withdrew the full e-transfer, there was little incentive for them to use the account again. Due to the lack of account interoperability, e-transfer recipients were not able to pay for the goods and services using electronic payments requiring them to cash out the e-transfer as soon as it was received.

The full findings of the impact evaluation will be publicly available by May 2015 and shared with the humanitarian assistance and inclusive finance communities.

[1] Globe Telecom has 32% of the Philippines mobile network market following Smart Telecom with 52%.