FINANCE and central bank officials will visit China next year to continue talks with Alibaba Group Chairman Jack Ma on the development of e-commerce in the Philippines.
“We are planning to visit him. He invited us to have further discussions in China. We will visit him probably in January with Central Bank (officials). We’ll review the regulatory environment here so that we don’t have regulations that choke the growth of e-commerce,” Finance Secretary Carlos G. Dominguez III said in a statement.
Mr. Ma briefed Mr. Dominguez about his so-called “3-1-0” initiative, under which firms can apply for a loan online in only three minutes, and the money transferred to its account in one minute, with zero human contact.
Mr. Ma’s online loan scheme incurs a loss of $4 for every $10 million lent, against a $10 for every $100,000 ratio on loans processed by humans.
Mr. Dominguez said that such digital innovations are now being explored by the Finance department with a view towards aiding micro, small and medium enterprises (MSMEs) and expand information-sharing across the government.
Mr. Ma visited the Philippines last week.
“Ma told us about the power of e-commerce. Today’s millennials are more comfortable doing digital transactions rather than physical transactions. He said that this is the way to the future,” Mr. Dominguez said.
“The whole point of the matter is if you have a digital platform like that you develop a lot of information that you can use in giving loans, and even in providing security information to the police,” he added.
The Bangko Sentral ng Pilipinas announced in 2015 the National Retail Payment System, which aims to raise the share of digital payments to 20% of total transactions by 2020 from just 1% in 2013.
Banks and e-money issuers meanwhile are also currently working to set up the PESO Net clearing house for high-value electronic fund transfers by next month, which is expected to eventually replace paper checks.
Another clearing system, InstaPay, which will process real-time credit for online settlements worth P50,000 or less within and across banks, is also in the works.
“We must look at our (financial) regulations and ensure that it will not stymie the growth of our MSMEs,” said Mr. Dominguez.
Mr. Dominguez added that Mr. Ma intends to invest in the Philippines in the next five years, most likely in the service industry. “The Philippines has the best service and has the heart to become key players in the industry,” Mr. Ma was quoted as saying.
Mr. Ma has said he hopes to help the Philippines transition to a cashless society, and connect the country’s e-commerce markets to Europe and China, to the benefit of small enterprises.
In February, Mr. Ma’s Ant Financial Services Group acquired 45% of Globe Telecom, Inc.’s financial technology arm, Globe Fintech Innovations, Inc (Mynt) – a deal approved by the competition commission in August. – Elijah Joseph C. Tubayan