PH Financial tech must be human-centered - expert | Business and Politics - video Dailymotion

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PH Financial tech must be human-centered - expert | Business and Politics  RCBC Chief innovation and inclusion officer Lito Villanueva talks about utilizing financial technologies to devise human-centric solutions. He says that financial inclusion of the economically challenged population is crucial.  Subscribe to The Manila Times Channel - https://tmt.ph/YTSubscribe   Visit our website at https://www.manilatimes.net   Follow us:  Facebook - https://tmt.ph/facebook  Instagram - https://tmt.ph/instagram  Twitter - https://tmt.ph/twitter  DailyMotion - https://tmt.ph/dailymotion   Subscribe to our Digital Edition - https://tmt.ph/digital   Check out our Podcasts:  Spotify - https://tmt.ph/spotify  Apple Podcasts - https://tmt.ph/applepodcasts  Amazon Music - https://tmt.ph/amazonmusic  Deezer: https://tmt.ph/deezer  Stitcher: https://tmt.ph/stitcher Tune In: https://tmt.ph/tunein  #TheManilaTimes #SMNIBusinessandPolitics

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00:00 fifth and final talk for the day. Our final speaker is the chairman of the

00:04 board and of the Alliance of Digital Finance Association. So ladies and

00:08 gentlemen, it is a privilege to present our RCBC Chief Innovation and Inclusion

00:12 Officer, Lito Villanueva.

00:16 Thank you so much and of course, I can't deny the invitation of Clink and

00:29 of course, Blanca. As they say, there's no such thing as a free lunch.

00:35 That's why we should work here today. Again, good afternoon to everyone and of

00:40 course to most of you here who are practically familiar faces.

00:46 Thank you most especially to the Manila Times for inviting me as one of your

00:52 guest speakers for this year's Digital Transformation Forum. As you may know,

00:57 this is my buzz phrase. Apart from financial inclusion, digital

01:02 transformation is what fuels me to do what I do every day. I am honored to be

01:10 amongst fellow thought leaders, innovators and reputable industry

01:14 experts here who each bring to the table their own invaluable insights and

01:20 expertise of where the Philippines digital economy is heading. In the ever

01:26 evolving landscape of FinTech, it is important to regularly tune in on what's

01:31 been working, what hasn't and what we can improve on moving forward. As I take just

01:38 a quick look around this room, I can see your faces listening to me at the

01:44 present but I can bet that many of your minds are wandering off to the future.

01:50 Don't worry, no judgment. It's human nature to always wonder and look towards

01:57 what's ahead. It's humanity's survival mechanism. What I am eating later, what

02:05 time do I have to be there, what's on my agenda tomorrow, what do I have to

02:10 prepare. Our minds gears are always turning. In this industry, it's the same.

02:18 We are always thinking of what we can achieve in the future. How do we

02:23 accomplish progress, growth and development. Our efforts all point to

02:29 building the unforeseeable future. We rely on trends, predictive analytics,

02:36 reports and forecasts to guide our direction. The present is crucial because

02:42 the future is the end goal. To navigate the complexities of digital

02:48 transformation in our industries, it is first necessary to take an overarching

02:53 snapshot of the state of Philippine FinTech. The realities, challenges,

03:00 achievements and opportunities for improvement. Understanding our target

03:05 market and the pain points of the underserved and unbanked Filipinos we

03:09 intend to serve is key in fostering digital transformation and financial

03:15 inclusion. Just this month, the Philippines stepped into the spotlight

03:20 with a grand exhibit of Bagong Pilipinas, the Philippines country pavilion at the

03:26 Singapore FinTech Festival regarded as the one of the world's most influential

03:31 FinTech events. In fact, it was attended by over 70,000 participants from 150

03:37 countries. We had the opportunity to demonstrate Filipino skills, talents and

03:43 ingenuity and also highlight the country as a bright spot for digitalization and

03:48 finance on the global stage. Our dream future is hope. H-O-P-E. We need to be

03:58 hands-on, open, persistent and empathetic. To be hands-on requires on-the-ground

04:08 immersion and first-hand discoveries. Getting down to the nitty-gritty and the

04:13 realities of the world, no matter how harsh they may be. To ensure that our

04:19 innovations will bear a positive impact on communities, we must listen and they

04:26 must feel heard. When we connect, they cooperate. When we communicate, they trust.

04:34 In the Philippines, we have always struggled with a severely underserved

04:39 Filipino adult population. Several geographically disadvantaged regions,

04:44 conflict areas and low-income rural communities have little to no access to

04:50 the Internet, financial literacy and even basic financial services. The Banco

04:56 Central ng Pilipinas reported that the number of unbanked Filipino adults in

05:01 2019 was 71% of the total adult population. This urged VSP to craft the

05:08 national strategy for financial inclusion and the digital payments

05:12 transformation roadmap, which has twin targets to onboard 70% of our adult

05:17 Filipinos into the formal banking system and convert 50% of retail financial

05:23 transactions to digital by end of this year. The good news is that we are set to

05:30 surpass these targets by the end of 2023 and thanks to the entire ecosystem of

05:37 industry players. In just two years, FinTech saw a significant boom. According

05:43 to a study by McKinsey, the rate of account ownership climbed exponentially

05:48 to 56% in 2021 from just 29% in 2019. This means we banked over 17 million

05:57 Filipinos. The Philippines has one of the fastest population growth rates

06:02 worldwide and the bankable population is projected to rise from 65 million in

06:08 2022 to about 85 million by 2030 and that is about a 30% increase. The number

06:17 of digital retail payments also surged from 30% in 2021 to 42% in 2022. In fact,

06:26 6 out of 10 Filipinos altered their behaviors in the past three years to

06:32 integrate digital services into their lives. Next, we must capitalize on being

06:39 open. Open-minded. Open to every challenge as an opportunity for growth

06:46 and always open to collaborate. The present and future of FinTech is largely

06:51 built by prioritizing public infrastructure through government

06:56 collaborations and expanding our digital services to appease the ever-evolving

07:02 hyper-specific needs of our countrymen. The current administration has made

07:08 digital infrastructure a top priority and President Marcos Jr. certified key

07:14 legislative bills in digitalization as urgent such as the Open Access in Data

07:20 Transmission Act, Internet Transaction Act, e-governance and Critical

07:25 Information Infrastructure Act to improve digital accessibility, governance

07:30 and cybersecurity. This year, we have proudly released the annual FinTech

07:37 Philippines report 2023. It is a prized resource material of even legislators,

07:43 policymakers, academe, researchers, investors and foreign missions in the

07:48 country. It captures the evolution of the country's FinTech industry and the impact

07:54 of the individual or the impact the individual and collective activities of

07:58 all players have on the lives and dreams of Filipinos. According to this report,

08:04 the Philippines is seeing substantial growth in banking and connectivity. From

08:09 2022, we've already seen a 9.2% increase in deposit accounts which

08:17 stands at 93.2 million and 41 million active e-money accounts. This is good

08:24 news and we know that Filipinos are never without their smartphones, Facebook

08:29 accounts and even of course TikTok dances now. We have the most number of TikTok

08:37 accounts in the Philippines or in the region right now or in the world

08:41 practically. And of course you can now also make payments via TikTok by the way

08:46 but unfortunately for markets such as Indonesia, they actually banned the use

08:52 of payments via TikTok. And most likely Philippines and other markets in the

09:00 ASEAN region will follow suit. So we talked into this behavioral fact.

09:06 Smartphones have penetrated 85% of the population with about 97.5% of them

09:13 mobile broadband connection users. That's about 84.75 million internet users and

09:19 counting. Through the National Economic Development Authority or through

09:24 their National Economic Development Plan, the Securities and Exchange Commission

09:27 of course together with the BSP, the government has achieved its FinTech

09:32 targets which is five years in advance. We now have 285 FinTechs as of 2023. This

09:39 fit is a testament to the collaborative efforts of stakeholders across the

09:44 financial ecosystem. We have also remained persistent. Hurdles are

09:49 inevitable and roadblocks are expected. But we must power through because the

09:54 global and Philippine outlook are both promising. Digital banks and digital

09:59 centric apps are being used by 38% of the population for online payments.

10:06 21% use them for lending, 11% for remittance and 9% for e-wallets.

10:11 With these statistics we have a better grasp of what matters to most Filipinos

10:17 and their banking priorities. Listening to our audience is key in improving our

10:22 services. The future involves cultivating a digital financial ecosystem that's

10:28 robust and dynamic and built on innovation. Regulators in the Philippines

10:35 are laying the groundwork for digital first business models, introducing new

10:40 digital banking licenses, creating real-time payment systems and

10:44 establishing a standardized QR code payment network which is called QRPH.

10:48 Updated EKYC digital identification and verification are also enforced for

10:54 digital banks and this is for better safety and security during the customer

11:00 onboarding process. In fact just two weeks ago during the first Cashless Expo

11:05 together with the DTI and the BST they introduced a campaign for

11:10 interoperable payments called "Scan Na All".

11:16 It's hard to be a scam na all.

11:22 That is part of the education amongst Filipinos that you could

11:26 actually make use of your any bank or e-wallet app to scan any QR.

11:33 The idea before is that once they see a GCash QR in any merchant

11:38 ang isipin ng tao ng customer, "dapat I have to have a GCash account as well."

11:43 Hindi siya pwede gcash to gcash lang. So it's actually gcash to any

11:47 to gcash. So practically it's interoperable. You may have a

11:53 rural bank app and you could actually scan a Maya QR, a GCash QR,

12:00 an RCBC QR, a BPI QR, a Metrobank QR, etc.

12:05 Kaya ang campaign ngayon is "Scan Na All". As I've said, huwag naman sanang maraming scam na all.

12:13 Again, transactions through the BSP's Instapay and PesoNet gateways have

12:18 significantly increased by the end of September 2023 with a 30% rise in

12:23 transaction value reaching about 9.2 trillion pesos and a 40.5%

12:29 increase in transaction volume totaling 638 million transactions from

12:33 January to September this year. The FinTech market is expected to grow by

12:38 44 billion US dollars by 2024 and the Philippine government has been beating

12:44 up its investments into digital to transform the country into a digital

12:48 hotspot. In his second State of the Nation address or SONA by

12:53 President Marcos Jr., he mentioned that the digital economy generated about 2

12:57 trillion pesos which is about a tenth of the country's GDP. The FinTech

13:03 industry is forecast to continuously grow as the Philippines aims to be a 1

13:08 trillion US dollar economy by 2033 and this is a study according to S&P Global

13:14 Market Intelligence. And at the end of the day, progress and hope is nothing

13:19 without its last letter and that is E for empathy. Technology is a

13:25 transformation driver. If leveraged well and ethically, it creates empathy-driven

13:31 and human-centric solutions. We must continue to solicit feedback from

13:36 partners and valuable clients to sharpen our approaches and ensure that they are

13:40 relevant to the concerns and lifestyles of the market. At RCBC, we prioritize

13:46 delivering innovations with empathy and from there RCBC's hyper growth became

13:52 one for the books. We leapfrogged from being eighth in ranking in terms of

13:57 assets among privately held unibanks in 2018 to fifth by end of 2022. We did it

14:05 in barely four years and at the height of the pandemic. Our assets grew 23% to

14:11 over 29 billion US dollars and our net income soared by 71% to 294

14:18 million dollars. We have also seen an 8% increase in loans and a 28%

14:23 increase in deposits. Of course, we have also found, we of course during the

14:29 pandemic at the height of the lockdowns, we are the only organization that has

14:34 actually seen an investment coming from Sumitomo Mitsubishi Banking Corporation

14:39 or SMBC having 20% equity shareholdings into RCBC that translates to about 428

14:46 million US dollars and in fact that was the biggest announcement made or a PR

14:51 coup made during the Singapore Authentic Festival during last year's event. So we

14:56 have garnered global recognition by prestigious award-giving bodies and

15:00 among the greatest accolades RCBC bagged this year is the best bank for digital

15:05 by Asia Money for the fourth consecutive year. Asia Money said in a statement and

15:11 I quote, "When it comes to digital solutions, RCBC remains the bank to beat."

15:15 We have also received the Eye on Innovation Award by Gartner,

15:20 YouTube Challenger Award for our viral and out-of-the-box digital ad campaigns

15:24 generating combined views of over 17 million in over a couple of days.

15:29 Grand champion for digital payments and financial inclusion by the Bankers

15:33 Institute of the Philippines or BIFIL and triple wins in our marketing efforts

15:38 in the recent Bank Marketing Association of the Philippines Awards and ranked

15:42 number one in the Philippines Best Customer Service 2023 survey by the

15:47 Philippine Daily Inquirer and global research firm Statista. These are just a

15:52 few of over 100 local, regional and global awards we reaped in the last four

15:58 years. We built digital platforms for a wide range of customers. Empathy means

16:04 considering the needs, pain points and desires of the people you serve in order

16:10 to uplift and empower their lives as best as you can. First we have RCBC Pulse,

16:16 RCBC's primary banking app launched just this year and it is our one-stop-shop

16:21 all-in-one digital banking app that offers the widest range of digital

16:25 services such as the country's first digital in-app UIPF where you can manage

16:30 and place new investments within the app, mobile check deposit,

16:35 foreign exchange for six major foreign currencies in real time, spend

16:40 analyzer and coming very soon are actually loans. In fact we're also the

16:45 first bank to allow our 12 million overseas Filipino workers to open RCBC

16:50 Pulse accounts anywhere they are in the world using international mobile numbers.

16:55 So it even allows digital account opening as I've said by our OFWs.

17:02 In fact we just launched that about two days ago and again this is more about

17:07 hyper personalized initiative in terms of offering our respective customers.

17:15 RCBC DiscardTech is the world's first multilingual financial inclusion super

17:20 app in the vernacular Tagalog English or Taglish and Cebuano languages

17:26 that makes financial services such as savings, fund transfers, telemedicines and

17:31 insurance and loans accessible to more Filipinos. And of course it holds a very

17:36 competitive annual savings rate of 6.5% and by the way starting December

17:43 of course 12-12, we will be waiving the insta-pay fees.

17:49 So 12-12 we will be waiving insta-pay fees for transfers

17:58 of 1,000 and below. So for those who are going to be in the Paginaldo, they don't have additional insta-pay fees.

18:06 So you can get the 1,000 pesos you're saving.

18:13 These are some of the things that we've been doing by the way and in this in

18:17 fact we grew DiscardTech volume by as much as 245% year-on-year based on our

18:24 gross transaction value. And we also delivered RCBC ATM GO, the Philippines

18:29 first bank agnostic, last mile and grassroots oriented mobile point of

18:33 service ATM service to Filipinos in need of basic financial assistance. ATM GO is

18:39 conveniently located in community hotspots like mga palenke, sari-sari stores,

18:44 transportation hubs, drugstores, even co-ops and rural banks. And RCBC is the

18:50 only private uni bank in the Philippines with 100% coverage of all the provinces

18:55 nationwide, 96% coverage of all cities and 51% coverage of all

19:00 municipalities. And take note that by next year we will be covering 100% of

19:06 all cities and 100% of all municipalities. And in fact we have grown

19:11 the number of terminals deployed by as much as 700% by end of this year versus

19:17 last year. In fact we have also rolled out the terminal in Turtle Island

19:25 which is the southwestern tip of the Philippines. And that is only, it will

19:32 only take you 30 minutes by boat to go to Sabah, Malaysia.

19:38 And then another one is in Pagasa in Baguayan Islands which will take

19:47 you about 45 minutes to Taiwan. So we are the first bank to have

19:54 those services for our people in those areas. And again 96% of ATM GO

19:59 transactions are outside the Philippines national capital region, 65% are rural

20:05 women users and 61% are transactions for government's social amelioration

20:10 program or CCT or Pantawid Pamilan Pilipino program. And ATM GO is enabling

20:15 millions of Filipinos to receive government payments and assistance

20:19 easily. During the pandemic we disbursed over 21 billion pesos to 5.6 million

20:25 families and that is approximately 28 million individuals. ATM GO terminals

20:31 are also strategically stationed in geographically isolated disadvantaged

20:36 and conflict areas such as in Busuanga, Coron, Culion in Palawan province and

20:41 armed conflict areas such as in Lake Cebu in South Cotabato in Region 12. And of

20:46 course we're the only bank that is also present across all the five provinces in

20:50 the Bangsamoro autonomous region in Muslim in the now. For SME owners and

20:55 entrepreneurs we unveiled just this month what we call RCBC BOS. In fact

21:00 before this was RCBC BOS, B-O-S-S. Yugo BOS filed a complaint.

21:06 So we did, if you don't want to, just call me BOS, B-O-Z. So they agreed. Because Z is also

21:14 Jen Zenners, Jen Z. That's why our other app is called RCBC PALS with a Z.

21:20 To make all our apps awesome. So it is our newest all-in app for

21:29 small business owners where they can prepare e-invoices, manage payroll, set

21:33 budget, financial goals and do fund management all in one app. And of course

21:38 we have seen the growth of RCBC. In fact the seven-year comparative annual growth

21:44 rate of all our products have recorded about 113% for RCBC PALS and 86%

21:50 for RCBC ATM GO. And just to give you a concluding statement about my

21:58 presentation this afternoon, our main thrust as a financial institution is

22:02 banking with a heart and delivering digital forward services in innovative

22:07 products that cater to the specific needs and struggles of our kababayan.

22:10 Again let me state this, combining the power of revolutionary digital solutions

22:18 and meaningful human relationships is the future of FinTech. To allow a

22:23 digital forward cash like country to flourish, the industry must be focused on

22:28 creating pioneering high-impact and human-centric digital financial

22:32 innovations. Again to everyone here this afternoon, let us remember that the

22:37 future is built on H-O-P-E. Thank you and have a great day.

22:44 Thank you very much for sharing all of that. That was a lot to unpack. Thank you

22:51 so much Jing and Ben and of course our honored guests Mr. Lito Villanueva and

22:58 Mr. Mark Marlon Sorongon for such a very fruitful discussion.

23:03 Like what they said, FinTech has come a long way but it still has a long way to go.

23:11 Like was mentioned earlier, there is hope especially with we have people

23:17 staying with us to listen and to share and to be able to know more about the

23:22 next step that we can take with the outlook toward 2024. With this Blake in

23:27 this token, our chairman and CEO and our president and COO, thank you for rounding

23:33 off and completing our talks on digital transformation with an outlook on 2024.

23:42 So again thank you Maybank CISO Marlon Sorongon and RCBC Chief Innovation and

23:48 Inclusion Officer Lito Villanueva.

23:52 Thank you.

23:54 you

23:57 you

23:59 [BLANK_AUDIO]

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