Cash-By-Text Pilot Goes Live In Philippines

Published on 15 October 2010

Participants of the new pilot project receive text messages which they can "cash" in part or in full at any of 18,000 participating corner stores. Copyright: WFP/Philippines

Mobile phones are everywhere in the Philippines, even the slums of Manila, where people either have their own or share with others. That means the country is well suited to a new pilot project that uses text messages to distribute money earned through WFP 'cash-for-work' projects.

MANILA—After a hard day’s work rebuilding shelters and schools, and clearing flotsam out of the canals of Manila, a group of people hit by last year’s typhoon flooding all receive the same text message on their mobile phones.

It says that they have each received around US $6.00 (about 80 percent of the daily minimum wage) which they can redeem at any of the myriad corner stores scattered across the city—particularly its urban slums.

“It’s like a digital wallet,” explains Stephen Anderson, WFP’s Country Director in the Philippines, who says that using Manila’s near universal mobile phone coverage to manage disbursements solves several problems, both for cash-for-work beneficiaries and WFP.

Cash by text

The first and most obvious, according to Anderson, is that it’s more efficient. “The new system allows us to sign up participants, enter them into a database and when the projects they’re working on are completed, the payments go out automatically,” he said.

Anderson says the text-system will also resolve many of the logistical challenges of organizing “cash distributions.”

“Whenever cash distributions to large groups of people are involved, WFP has to ensure the safe distribution of the cash as well as the safety of the beneficiaries after they have received it,” said Anderson.

Transferring the money via text message, by contrast, can help resolve both problems. Instead of gathering a at distribution site, beneficiaries can claim their money at any of 18,000 participating corner shops.

An ideal solution

Some eight in ten people in the Philippines have access to a mobile phone, according to the National Communication Commission, even in the poorest areas where a basic model can cost as little as US $10.00.

A country that likes to communicate, the Philippines boasts both a phone-savvy society and a booming telecoms industry which has stepped forward with the technology to run the mobile cash transfer system.

Globe Telecom Inc., a Manila-based telecoms firm, has furnished both the phone cards for the beneficiaries and the “G-cash” software package which manages the transfers. The company has also designed the training materials used to show participants how to “cash” their text messages.

Launched in September 2010, the mobile transfers pilot project started with 2,000 participants of cash for work projects in and around Manila, out of about 40,000 people still involved with WFP early recovery activities in the Philippines after Tropical Storms Parma and Ketsana in 2009.

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Justin Smith

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Justin Smith worked as a journalist before joining WFP in 2010. He tweets at @justin_eugene