Rethinking Finance


Sure, we love our country; it is our own. But anyone who has ever lived in a developed country and moved back to the Philippines will have many complaints despite the happiness and feeling of home, and I am no exception. But while many things are truly so difficult to solve — corruption, poverty, environmental issues, education system, lack of healthcare, even traffic — there are also so many low-hanging fruit that just seem so fixable that you wonder what on earth could possibly be the reason for these odd situations to still exist.

One of which is the need for physical forms to be filled out and physical signatures on everything from changing your home address in a bank to asking for a copy of your diploma to having to get a Special Power of Attorney for a rental contract, write an authorization letter for an LTO (Land Transportation Office) registration renewal, print, fill, sign and submit sheets of paper just to register to vote, contact tracing, need I go on… And the most head-scratching of them all: having to have things notarized, which should mean one is physically present to sign, when we all know they aren’t and simply send someone to do it with a copy of our IDs. Why are these all still required? Why is all this paper being wasted, all these hours of work, time in queues for things that could so easily be done digitally? Well, the answer is no one really had the impetus to implement a better way, even as everyone knows things could well be done better.

But this pandemic and socially distanced world have made the act of filling out forms not only a hassle but truly impossible and even unsafe to accomplish. And the fact that there seems to be no other means to do anything except perhaps spend so much money on couriers for physical documents to move around, has truly limited the activity and the economy — everything from a purchase of property to openings of bank accounts and applications of loans. Even legal cases and our right to justice is delayed or downright chucked by the simple problem of having to physically file paperwork in courts. Worse, the lack of a system for having things securely signed by the right people and to verify, validate, and audit has given rise to the phenomenon of fake documents and a reputation of the Philippines to have questionable paperwork. Foreign countries so distrust anything we provide them that there is an entire office dedicated to authentication at the Department of Foreign affairs, which costs people, especially OFWs, an arm and a leg.

I had a chat with Mon Paterno, seasoned investment banker, former head of DBP (the Development Bank of the Philippines), and now fintech innovator — on his latest quest: to ease our lives and “put Recto out of business.” On the latter, he means, to make the process of documentation, of signing contracts so secure and credible that it would be impossible one day to fake anything (a practice which is known to be done at Recto). He is doing this via a truly Filipino-made consumer-centric app called ZQR (pronounced “Zee-cure,” a play on “Secure”) which will have three services.

ZQR Forms would allow a company to send a person a form to fill in with personal information and send it back digitally “signed” fully encrypted and assured that the person is the rightful agent. For instance, applying for a bank loan could be done by the bank sending all the forms via the app to the customer who would fill and sign them within the secured platform. ZQR Sign All would allow for original documents to be scanned and shared to a group who would then individually review and click a button “signed” to have a group-approved document such as a contract, minutes of a meeting or even a joint bank account transaction. The third is ZQR Verify which would allow an institution to send a document to a third party on behalf of the person requesting to guarantee its legitimacy. Simon gives the example of a school providing a student’s transcript directly to a graduate program the student is applying to.

But how exactly would this all happen, how would you make sure this person is who she says she is? Mon’s rationale is intuitive: borrow the e-commerce model of transactions. By using a person’s debit or credit card, which banks are obliged to keep secure, even having second checks like OTPs, touch ID, and face recognition to create an account, the communication done via the app becomes more secure than an e-mail. And while they do not claim to have contracts that are more enforceable as they are unaware of the encrypted content being exchanged, they can at least claim that the transactions are being done by the persons they need to be done with, making notarized documents as Simon puts it — “archaic.”

Though the app is still in its pilot stages, indeed does it not all sound so… sensible?

Until of course I started wondering, but wait, is not the problem the fact that the documentation is so stringent to open a bank account in the first place, which is precisely why we have such a high level of financial exclusion? Would this not ultimately mean that not only would the market be so limited, it would only cater to people who are already enjoying the privileges of having access to finance, among other things. Simon says, yes, admittedly they need a higher level of security than what is afforded by e-wallets but that we have to start somewhere. He does not pretend to solve that problem, but that problem needs to be solved by the banks. The National ID for instance would resolve the slow and painful process of KYC (know your customer). We cannot keep doing band-aid solutions, he says; the wallets and the fintechs are cool but ultimately people need to be integrated into the real economy, have access to the real and regulated banks: spoken like a true Investment-slash-Development Banker. Well, that, in parallel with creating a customer-friendly system that solves the solvable, does sound like an achievable goal rather than a pipe dream.

Note: more details on the app can be found at


Daniela “Danie” Luz Laurel is a business journalist and anchor-producer of BusinessWorld Live on One News, formerly Bloomberg TV Philippines. Prior to this, she was a permanent professor of Finance at IÉSEG School of Management in Paris and maintains teaching affiliations at IÉSEG and the Ateneo School of Government. She has also worked as an investment banker in The Netherlands. Ms. Laurel holds a Ph.D. in Management Engineering with concentrations in Finance and Accounting from the Politecnico di Milano in Italy and an MBA from the Universidad Carlos III de Madrid.