SeedFinance Corporation

Finally, Money to Islands and Far-Flung Communities

The Islands Activation Program is initiated by SMART Communications, the largest telecommunications company in the Philippines, in partnership with SEEDFINANCE a microfinance-oriented financing company. The program expands the financial services of Field Partner Financial Institutions. IAP endeavors to allow sustainability pricing and incentives so that the service will grow beyond financial dependency and will continue to serve its goals.


Mandaluyong City, Metro Manila -- (SBWIRE) -- 08/23/2010 -- There are about eight million overseas Filipino workers (OFW) deployed in various countries. Last year, BSP estimates that remittances have amounted to $17.3 billion which is equivalent to 10 percent of the Philippines gross domestic product. This makes overseas remittances the largest foreign exchange resources for the Philippine economy, next to exports of goods and services.

Remittance is the process of transferring money by a foreign worker to his or her home country or from a different area in the same country to another point of pick-up in another country. This is widely used by OFWs to send money to their loved ones back home. Whenever they use this method, it promotes access to financial services for the sender and recipient, thereby increasing financial and social inclusion.

It is a fact that remittances and money transfers in the Philippines are playing an increasingly large role in the economy of the country and contributing to easing household and enterprise fund management both from the sender and the receiver.

Over the last decade, technology has reshaped the face of the remittance system. New technological frontiers are now available, undoubtedly a great improvement in efficiency and in reducing cost of the remittance process.

With traditional methods, access to facilities is often limited especially to those in remote and under serviced areas. Today, the ubiquity of mobile technology makes it possible for almost anyone to conveniently have access to secure, efficient and low cost remittance platforms.

That is the good news! But is it reaching the target communities of poor households?

Before, remittances happen through conventional channel of agents (Western Union, Money Gram, Bank-to-Bank transfers, etc.). Western Union and Money Gram are generally confined in urban areas or town centers of a rural area while Bank-to-Bank transfers often have a higher propensity to require a bank account to avail of the service.

With the increasing relevance of cellular phones reaching the most remote and hard-to-reach places of the country, mobile money transfer has caught the interest of the people in these mountain and island barangays. Cellular phone as a remote control device to effect transfer of money elevated the system beyond its remarkable stage. It actually brings relevance to the lives of the poor.

The Islands Activation Program

Cooperatives and NGOs are located in areas where micro and small clients operate their enterprises. These are the areas where banks and other financial institutions dont dare go but where the need for money transfer service is most needed. The goal of the Islands Activation Program is to accredit a field Partner-Financial Institution (PFI) to become a Money-In, Money-Out (MIMO) Center that functions like a SMART Wireless Center or a Banco de Oro branch in terms of intermediating fund transfers. Instead of crossing the sea or travelling on a dirt road going to an urban or city center just to pick up or send money, a client can now do all transactions within their community.

This convenience is embodied in a program initiated by SMART Communications, the largest telecommunications company in the Philippines, in partnership withSEEDFINANCE, a wholesale financial institution in the micro-no-more movement. The program provides money transfer services to the islands and remote barangays using mobile phones and liquidity fund facilities. It is implemented through retail financial institutions (cooperatives and NGOs) that facilitate the actual money reloading from the sources of funds to encashment by unbanked individuals and households.

The program is targeting to establish presence in 40 areas in the Visayas and Mindanao with combined user-outreach of 30,000 in the 2010 pilot phase. As of July 2010, it is almost 100% in terms of target area accomplishment.

More Benefits to the Client

Being enrolled in the program will enable a user to enjoy not just the convenience and affordability of money transfer services but also the handiness of bills payments and ATM services. Under the SMART Money program, each member will be issued with a PIN-based SMART Money card that can be used to pay for purchases and do withdrawals from any ATM. The card is linked to the mobile SIM of the subscriber. It is a secure way of moving and using money from one place to another and an efficient way of managing opportunity costs of the clients.

Benefits to the Field Partner Financial Institution

The program expands the financial services of a PFI. It appropriately responds to the needs of a micro-entrepreneur as this is mainly micro-remittance in nature. Since microfinance needs to be operated in a financially-sustainable manner, the program endeavors to allow sustainability pricing and incentives so that the service will grow beyond financial dependency and will continue to serve its goals.

To become a partner of Islands Activation Program (IAP), please contact any SEEDFINANCE field officers for the details of enrollment requirements. Visit for more information.

SEEDFINANCE is a registered as a microfinance-oriented financing company in April 2007 by the Securities and Exchange Commission of the Philippines. Its two founding organizations are CARE Philippines and Sustainable Economic Activity Development (SEAD) Incorporated. SEEDFINANCE provides high quality microfinancial services to millions of poor and low-income people in the Philippines with a strong network of 73 partner organizations. SEEDFINANCE also delivers loans, working capital and asset acquisition means to small businesses. To date, the company has reached more than 1.2 Million people through its partner-organizations across the whole country.

About Smart Communications, Inc
Smart Communications, Inc. (SMART) is the Philippines leading wireless services provider with 43.2 million subscribers on its GSM network as of end-March 2010. SMART has collaborated with SEEDFINANCE Corporation to equip island-based microfinance institutions with mobile-based financial products and technologies that will allow them to send and receive funds using SMART mobile phones. Since 2000, SMART has been actively promoting the use of mobile-based financial services and microfinance solutions, through the revolutionary Smart Money, the worlds first electronic cash card linked to a mobile phone. Through Smart Money, SMART subscribers are able to conduct mobile banking, electronic money transfers, micro-purchases and micro-payments with just a few clicks on a cellular phone with a SMART SIM.