Friday, June 14, 2024

BPI microfinance arm ramps up digitalization to reach more Pinoys

The Bank of the Philippine Islands (BPI) is accelerating the digitalization of BanKo, its microfinance arm, in an attempt to offer digital banking to more Filipinos while expanding its “lite” branches across the country.

Banko senior vice president Rod Mabiasen

“Digital banking has become a necessity now. This is the reason BanKo continues to innovate the way we deliver our products and services to benefit self-employed micro-entrepreneurs (SEMEs) and underserved individuals,” Rod Mabiasen, senior vice president of BanKo, said during #BPITechTalk, a one-hour, monthly media roundtable series.

But, unlike digital banks, Mabiasen said BanKo is a “phygital” bank that blends the benefits of physical banking with the advantages of digital. This approach, he said is particularly helpful in the provinces where clients still prefer to transact with actual branch to talk to a real bank employee.

Mabiasen said Banko has expanded rapidly in putting up “branch lite” in the countryside, noting that it is now present in almost every city in the Philippines.

“Our aim is to open a branch in every town. In fact, before the pandemic, our target was to grow 100 branches every year. That slowed down during the pandemic but the number is picking up again,” the executive said.

In those branches, Mabiasen said BanKo copied the playbook of informal lenders by deploying employees dubbed “BanKo Pare” and “BanKo Mare” who actually go to the locations of their clients to offer the bank’s services such as loans and the collect payments eventually.

Only a small fraction of the countryside clients uses digital channels to pay for their loans or conduct banking transactions, according to Mabiasen. However, he said the bank intends to introduce them to digital banking services such as electronic payment.

BanKo is particularly pushing its mobile app, which is designed to allow clients to fulfill their banking needs — including opening an account, applying, monitoring and paying loans, buying load, paying bills, and sending money — anytime and anywhere.

The BanKo app also houses offers products and services such as TODO Savings, a high-interest earning digital savings account; and NegosyoKo Lite for business loans as low as P10,000 with simple requirements.

With its digital onboarding, clients can quickly open a TODO Savings account online with one valid ID. There are also no deposit and maintaining balance requirements, and no dormancy fees. TODO also comes with 4% interest rate p.a. to maximize savings.

Applying for a loan is also made easier with BanKo’s digitally assisted lending feature, NegosyoKo Lite, where clients can apply for a loan for as low as P10,000.

By lowering the loan amount, BanKo said it aims to serve more SEMEs including those belonging to the D market which is comprised of an estimated three million individuals. Clients just need to present one valid ID, a photo of their store, and business permit to apply.

“With our increasing digital capabilities, we are able to make everyday banking easier and more accessible to SEMEs and the masang Pilipino. We aim to uplift the lives of more Filipinos and, ultimately, share in the mission of building a better Philippines,” Mabiasen said.

In 2021, BanKo granted P9 billion in loans to micro-entrepreneurs, demonstrating the bank’s commitment to help small business owners as they recover from the adverse effects of the pandemic. These micro-entrepreneurs are part of more than the 200,000 SEMEs BanKo has been serving since 2016.

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