Using mobile phones to send cash to relief operations to disaster-hit Philippines.

Look closely, it’s a bank. Photo: Steven Lilley/Flickr A humanitarian relief agency will soon begin using mobile phones to send cash to employees of rehabilitation projects in typhoon-hit areas in northern Philippines.

The UN World Food Programme (WFP), with the Department of Social Welfare, is issuing SIM cards to 2,000 people participating in a cash-for-work programme in the national capital region and neighbouring provinces.

“Cash is… better because unlike rice, the beneficiary can use it to address other needs of their family,” said Stephen Anderson, country director of WFP.

These communities were heavily hit when two typhoons in quick succession, Ketsana and Parma last year caused damage estimated at US$700 million, according to the government’s National Disaster Coordinating Council (NDCC).

The first 2,000 enrollees (5 percent of the total number of people in the cash-for-work programme) were identified as the poorest, whose homes were totally or partially destroyed by floods and landslides, and who lived in urban areas with mobile-phone coverage.

“We selected these areas because we needed to test in an area where it is relatively safe and the [mobile] signal is strong. We need to see how this is going to work,” said Anderson.

A participant earns up to $6 per day, 80 percent of the regional minimum wage, for community rehabilitation activities such as home reconstruction. An estimated $39,000 will be sent via mobile phones for the pilot project.

A telecom provider tracks their new SIM cards and after 10 days of work, each beneficiary receives a text message informing them that money has been transferred to their mobile phone. The message is like a cheque that can then be cashed at 18,000 accredited banks, or even pawnshops. WFP has used similar technology to distribute cash or vouchers in Kenya and Syria.

Previously, the welfare department disbursed funds only through banks, or by cheque and cash. Celia Yangco, the under-secretary, told IRIN: “This makes it easier for beneficiaries to receive their much-needed funds, because some rural areas are not reachable by banks.”

In the Philippines, an estimated one billion text messages are sent every day. Some eight out of 10 people had mobile phones in 2009, according to the National Telecommunications Commission.