How should banking and finance sector align with FIRe
Winning together in the fourth industrial revolution
By Adrian Paul B. Conoza, Special Features Writer
As the banking and finance sector braces for developments in time for the Fourth Industrial Revolution (FIRe), the recently held BusinessWorld Industry 4.0 Summit gathered an esteemed panel of leaders in the sector to discuss how their sector are preparing for this revolution.
The panel was composed of Chuchi Fonacier, deputy governor of Bangko Sentral ng Pilipinas (BSP); Chris Manguera, chief managing officer and head of marketing and app product at fintech start-up Mynt; Kenneth Palacios, head of wallets business at mobile money and payments pioneer PayMaya Philippines; Hamilton Angluben, general manager of fintech platform Cashalo; and Yu Ming Chin, founder and executive director of Viventis Search Asia.
Beginning the discussion, Ms. Fonacier highlighted in an overview of the BSP’s industry outlook that one of the top strategic priorities of banks, even for rural and cooperative ones, at present is optimizing technology.
On the part of BSP, they continually engage other stakeholders as they maintain an “active multi-stakeholder collaboration,” reorient the regulatory body by putting up a dedicated fintech subsector within BSP’s financial supervision sector, and set more initiatives for more active supervisory and regulatory standards.
The heads from fintech companies among the panel continued the discussion by sharing their initial thoughts on what their sector should do to brace for FIRe.
Mr. Manguera of Mynt said that in order to push for the digital economy and for cashless record systems, a “cross-stakeholder engagement” is really needed, setting the frameworks and infrastructure around the integrated points of view of consumers, the private sector, and the public sector.
Cashalo’s Mr. Angluben, meanwhile, hoped the rest of the financial industry — the banks, the cooperatives, and other financial institutions — will really embrace FIRe, “because the problem is so huge that not only one company can solve” the apparent problems within the sector.
Mr. Palacios of PayMaya agreed, speaking of the sector’s “gargantuan task of enabling 70% of Filipinos to have access to formal banking systems.”
“At the end, we are not supposed to be competitors, but we’re supposed to be enablers. Because the challenge [at hand] is just too big that it becomes a win the moment we convert people to using digital products,” he added.
In addition, Mr. Yu of Viventis Search Asia observed that technology in the sector will really be a great help for the unbanked. “I think technology can become a very powerful equalizer,” Mr. Yu remarked, adding that technology can “tremendously bring down transaction costs” and tell the capability of a farmer or a street vendor in terms of their paying capacity.
Regarding fintech’s chances of reaching the unbanked in spite of difficulties in accessing customers, Mr. Manguera emphasized that their sector should keep the mind-set of providing access to more people as they disrupt banking and finance. “And when we disrupt, it should be our responsibility to also drive adoption in the end, because there’s no point in disrupting if adoption will be very low,” he added.
Responding on the apparently decreasing demand for physical banks, Ms. Fonacier said that while some banks may still apply for branches with the BSP and some have already gone fully digital, “at the end of the day it would really boil down to what’s the specific strategy of that particular bank.”
