Bringing Banking to the People

Lito Villanueva, Executive Vice President and Chief Innovation & Inclusion Officer, Rizal Commercial Banking Corporation at RCBC

Lito Villanueva, Executive Vice President and Chief Innovation & Inclusion Officer, Rizal Commercial Banking Corporation at RCBC

My vision of a digital-forward, mobile-first and cash-lite Philippine is a country that champions a financially inclusive ecosystem for all. Safe and easy cash-lite transactions and nationwide accessibility to digital financial services are critical to achieving this goal, but there is more to be done than producing top-notch digital innovations. To succeed, we must always ask: “Why?” What is the reason for what we do? When we keep our “why” at the forefront of our advancements, our objective becomes clearer, and our mission becomes stronger. Inclusive digital banking – for the people – is the path to progress.

The recent rise in digital payment adoption across the Asia Pacific region in the last 12 months is astounding, with 69 percent of APAC consumers increasing their usage of at least one digital payment method, beating 52 percent of consumers in North America and 48 percent in Europe. This makes the APAC region among the most active adopters of digital payments globally, with 88 percent already having used cashless payment modes like digital banking apps, e-wallets, and QR codes. In Southeast Asia, the Philippine is among the highest digital payment adopters of 2022, just after Indonesia and Thailand.

However, almost 50 percent of the Filipino adult population is still unbanked and underserved. Even though seven out of 10 of these unbanked adults own a mobile phone as of August 2022, we still have the lowest banking penetration rate in the region. Because most Filipinos are from far-flung regions, accessing both physical and digital financial services while increasing financial awareness continues to be a pressing challenge.

To bring people to us, we must bring sustainable and inclusive banking to them.

Importance of Breaking Barriers

Even if cash currently remains the main mode of payment for Filipinos, a financially inclusive, digital-forward ecosystem is still possible. When anyone can gain access to digital financial services, no one is left behind. Reaching the unbanked paves the way to greater benefits for our citizens and the economy.

Being banked reaps growth opportunities for a Filipino family’s wealth and secures the livelihoods of the breadwinners. Having a basic deposit account enables low-income Filipinos unfettered access to insured and competitive-interest savings, empowering credit, and lower transaction costs for remittances. For micro-entrepreneurs and small business owners, financial inclusion opens multiple doors for them, their businesses, and their families. They can tap into multiple loans that help expand their businesses, and avail of financial services and insurance that protect their businesses from any external shocks and unforeseen events.

“The recent rise in digital payment adoption across the Asia Pacific region in the last 12 months is astounding, with 69 percent of APAC consumers increasing their usage of at least one digital payment method, beating 52 percent of consumers in North America and 48 percent in Europe.”

For the marginalized and vulnerable groups such as women, access to financial services provides additional ladders of support for their economic empowerment and freedom. Women can open their own savings account, avail of credit for their self-made micro-businesses, and subscribe to life and non-life insurance protection. Financial inclusion also allows businesses and governments to access much-needed data to help close the gap between men and women across socio-economic spectrum, in terms of finance.

Fintech with a Heart

The key is making financial inclusion as enticing, easy, and seamless as possible for every Filipino. Through innovations with empathy, we touch on the common pain points of our consumers, and build solutions based on them. During the pandemic, we created RCBC DiskarTech, the country’s first multi-lingual financial inclusion super app in Filipino-English and Cebuano, eradicating the barrier of language. The app allows basic financial services, an attractive interest savings rate of 6.5 percent (the highest in the Philippine market), and an affordable 8-peso inter-bank transfer fee per transaction.

Through RCBC DiskarTech, we also formulated a performance-based program to help uplift livelihoods further. Through the NegosyanTech program, sari-sari (mom-and-pop) store owners – which are predominantly women and mothers – enjoy financial incentives for every digital transaction, helping users grow their wealth while adopting healthier saving habits.

We also created RCBC ATM Go, the country’s first neighborhood and last mile mobile ATM, stationed at common public places like markets, transportation hubs, and medical centers to solve the problem of distance and travel time. This also helped increase income generation options for micro and small businesses in low-income and rural areas. Over 60 percent of its transactions provide cash withdrawals to the government’s millions of 4Ps conditional cash transfer household beneficiaries even in geographically isolated and disadvantages areas.

RCBC MoneyBela is our latest innovation that combines the impact of physical interactions and the power of digital. This “phygital” (blended physical-digital banking experience) program was conceptualized after we realized that while we were successful in boosting the numbers of banked Filipinos, there were still millions who were hesitant and unreachable. Physical engagements are valuable to Filipinos because they place their trust on human connection. Knowing this cultural phenomenon, we deployed Banking Experience Agents via sustainable electronic tricycles to travel to distant and disconnected communities, providing banking services with a human touch, aligned with the ESG goals within the UN Sustainable Development Goals framework.

A fintech-forward future relies on increasing the value, number, and adopters of digital payments. The secret to how, however, lies in listening to what the people need and providing the right empathetic solutions to everyday problems.

All these high-impact and empathy-driven digital financial innovations being developed and implemented at scale during the pandemic period recorded exponential growth in terms of gross transaction volume and revenues, and merited close to 70 regional and global accolades. These recognitions include being named as the Philippines’ Best Bank for Digital for three consecutive years (2000-2022) by Asiamoney; the Philippines’ Best Financial Inclusion App by the Financial Technology Innovations Awards of the Asian Banker; and The Challenger award by Youtube works, a first for a Philippine bank for its out-of-the-box and viral social media campaign.

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