- xchange ( a subsidiary of a giant telecom, globe ) as a remittance agent in 2004. under both the models, merchants were allowed to conduct kyc. 8. most mobile phone based banking in philippines has been supported by the two giant mobile network operators – globe and smart. out of 39 million “ smart ” subscribers, 2. 5 million are using “ smart money ” ; and out of 23 million globe subscribers, 1. 2 million are using gcash services. according to the bsp, the average home remittance costs the sender between 2. 5 % to 5 % in the conventional system whereas the same routed through gcash or smart money would cost less than 2 %. low - income filipinos now use “ mobile money ” to send and receive domestic remittances – on average us $ 50. they use “ mobile money ” to purchase airtime and make purchases remotely. moreover, the policy makers are currently focusing on “ savings ” as a future service for mobile banking. branchless banking – pakistan 9. ladies & gentlemen, now let us look at pakistan. our financial sector is going through a dynamic transition, led by increasing uptake of technology solutions. this transition can be seen in recent e - banking data, with a transactional volume of 46. 4 million e - payments valuing rs. 4. 1 trillion during a single quarter of october – december 2009. these volumes are expected to grow substantially as pakistan has currently 95 million mobile users compared to 26 million bank accounts, highlighting the inherent potential for mobile banking in pakistan. 10. pakistan is the first country in south - asia to have issued branchless banking regulations, providing commercial and microfinance banks a supportive regulatory environment for developing partnerships and innovative delivery channels. our regulations support the bank - led model, in which the entire control & responsibility of the product and program rests with the authorized financial institution. due to inherent risks and existing legal framework, the telco - led model has not been permitted at the moment. these actions were reinforced by the ministry of information technology and pakistan telecommunication authority, which issued policy directives to provide technical support for the implementation of branchless banking in pakistan. 11. with an enabling regulatory structure and growing technology sector, pakistani banks and microfinance players can now utilize international best practices and models to diversify their financial services and develop partnerships for managing special initiatives. 12. as a result of branchless banking regulations, at present three models are operating

here, i would like to mention that sbp is facilitating the microfinance sector in rationalizing current high cost structures. gop has granted certain m. pickens, d. porteous, and sarah rotman, “ scenarios for branchless banking in 2020 ”, focus note no. 57, cgap and dfid, oct 2009. g. ivatury and i. mas, “ the early experience with branchless banking ”, focus note no. 46, cgap, april 2008. tax incentives to the sector. we expect that nadra would also favorably consider its fee structure for clients ’ verification for mfbs. branchless banking – international experience 5. ladies & gentlemen, mobile banking has come out globally as the most innovative alternate delivery channel in recent years. mobile banking has successfully accelerated financial inclusion and changed the financial landscape in many developing countries. mobile phones are compensating for inadequate infrastructure, slow postal services, and the limited coverage of banking systems in these countries. 6. take for example, kenya where the largest mobile service provider, safaricom launched m - pesa in 2007. it now has nearly 7 million clients in a country of 38 million people. it records an average of 10, 000 new registrations per day. m - pesa offers mobile phone - based services to clients across the country through a network of more than 10, 000 agents for account opening, handling of deposits and withdrawals into the customer ’ s virtual “ wallet, ” and customer support services. these agents can take cash from customers and credit it to their mobile account, and transfer money to other registered users. m - pesa has significantly reduced many of the spatial and temporal barriers to money transfer. the important outcome of m - pesa is the penetration of money flows to rural and hard - to - reach areas. according to a recent study, the income of kenyan household using m - pesa has increased by up to 30 % since they started mobile banking. 7. in asia, philippines was an early user of mobile banking initiatives. the central bank of philippines ( bsp ) has played an active role in the emergence of mobile banking. the bsp allowed two models for mobile banking. in first model i. e. bank - based model, the bsp allowed banks to outsource functions to one mobile operator i. e. smart money in 2001. in the second model i. e. nonbank - based model, bsp registered g