Building a Sustainable Mobile Phone Banking System: The Sta. Ana Case

From all appearances, Sta. Ana is a typical quiet 2nd-class municipality. Sitting on the northeastern-most edge of Luzon, Sta. Ana can be reached via a 14-hour ride from Manila or a 30-minute flight from Manila to Tuguegarao City, with another three-hour land trip. Other than an occasional cluster of commercial buildings or public markets, the road from Tuguegarao City to Sta. Ana is an unbroken stretch of farmlands and greenery. There is more to Sta. Ana than meets the eye, however. Although agriculture is still the predominant economic activity, there are latent industrial and tourism-related activities, mostly concentrated in the Cagayan Special Economic Zone and Freeport, which residents acknowledge as a key driver of economic growth, employment, and investment.

Despite these developments, basic services are still inadequate. Access to banking and financial services is lacking. There is only one bank — a branch of PR Savings Bank. The nearest commercial bank is in Aparri, a town two hours away by bus or van. Residents have to pay 300 PHP to 400 PHP ($7.14 to $9.52) for a Sta. Ana-Aparri round trip.

The combination of the town’s relative remoteness from a major commercial district and its lack of access to financial services was clearly an opportunity to introduce the benefits of mobile phone banking services. It was an opportunity that PR Savings Bank quickly seized. The bank’s Sta. Ana branch started offering mobile phone banking services in 2006, soon after it was approved to offer these services by BSP after receiving training and technical assistance from MABS.

PR Savings Bank was one of the first banks to offer mobile phone banking services as part of its products and services portfolio. It now offers a range of mobile phone banking services at its Sta. Ana branch and its 44 other branches nationwide.

Roberto Alingog, Jr., president and chief executive officer of PR Savings Bank, said the bank’s motivation for offering mobile phone banking services was based on three factors: offer an affordable, immediate, convenient, and personalized way to conduct client transactions; help client-merchants find a way to expand market reach and reduce costs; and facilitate development of a more robust local business environment, which would help generate more depositors and borrowers. From the onset, the bank saw mobile phone banking services as an alternative service delivery channel: a more cost-efficient alternative to ATMs.

In May 2008, PR Savings Bank, with support from MABS and Globe’s G-Xchange, Inc. (GXI), started paying its employees with GCASH mobile money through Text-a-Sweldo (Text-a-Salary). Text-a-Sweldo not only helped the staff better understand and promote the benefits of mobile phone banking services and mobile money in general, but also realized that the service could jumpstart mobile commerce and mobile payments in the communities served by the bank. PR Bank began promoting the use and disbursement of bank staff salaries via GCASH mobile money and offering payroll services via Text-a-Sweldo to large and mid-sized companies in its service area, thus driving the use of mobile money in communities while keeping the bank at the center of mobile money transactions, much the same way larger banks promote the use of debit cards.

Because Sta. Ana was an ideal location for the pilot, PR Savings Bank’s mobile phone banking services team worked with Globe’s GXI to accredit its clients as cash-in-cash-out mobile money agents and looked for companies interested in mobile money-enabled payroll services. In June 2008, the team identified a leisure resort and casino that started operations inside the Cagayan Special Economic Zone and Freeport as an ideal business to promote Text-a-Salary. During initial meetings with the resort, company officials acknowledged difficulties in managing their payroll. The company had about 800 employees, and every payday, it had to withdraw sufficient funds, prepare employees’ pay envelopes one-by-one, and have a cashier hand the envelopes to employees. The company was desperate for a more cost-efficient method of handling its payroll and was happy to receive an offer from PR Savings Bank to improve operations.

The first few months after the launch of Text-a-Salary were challenging. The bank had to teach the resort employees to register with GCASH and master procedures for cashing in and cashing out. It also identified businesses that could serve as GCASH mobile money agents. Eden Ellin was among the business owners identified. She owns a lodging house, grocery store, prepaid airtime loading station, and lotto outlet. Seeing that she could earn from the service charges, she agreed to become a GCASH mobile money agent. She averages 1,000 transactions a month, earning 30,000 PHP ($714). She says, “I not only get additional income, offering cash-in cash-out, but this also increases foot traffic in my grocery store and loading station, and I am able to offer additional services to my lodging house guests who want to send money outside Sta. Ana while they are on vacation.

By establishing a substantial user base of mobile phone banking customers, identifying and setting up local businesses as mobile money agents, and training bank staff to teach clients, PR Savings Bank has shown how rural banks can leverage mobile money and mobile phone banking services to not only benefit the bank but also entire communities.[14]

[14] To view a video of the president of PR Bank, please see the attached DVD or online at:


2 thoughts on “Building a Sustainable Mobile Phone Banking System: The Sta. Ana Case


  2. Pingback: Using Mobile Money to provide Payroll Services – an Example of the Better Than Cash Initiative from the Field | Mobile Money for Development

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