In photo during this session of BusinessWorld Insights Fintech series are (clockwise, from top left) moderator Beatrice Laforga of BusinessWorld; and panelists Robertson Chiang, founder, COO and CTO of Dragonpay Corporation; Shailendra Soni, ICT and fintech head at Frost and Sullivan; Mitch Padua, chief product officer of PayMaya; and Frederic Levy, chief commercial officer of GCash.

Industry players see the value of fintech for MSMEs

By Chelsey Keith P. Ignacio, Special Features Writer

The integration of technologies in financial services emerge further in the past years. Such innovations, as expected, eventually become reliable partners for many small and large companies.

During the second session of BusinessWorld Insights Fintech Series with the theme “Fintech’s Role in Empowering Businesses of All Sizes” held last July 21, industry leaders explored the fintech landscape of Filipino businesses and how they can further develop.

The usage of fintech notably increased amid the quarantine that started last year, observed Robertson Chiang, founder, chief operating officer and chief technology officer of Dragonpay Corp.

“2020 was really a remarkable year, and this was primarily due to the pandemic. Our transaction almost tripled during this period, which is a reflection of the people changing their habits from physical retail to going online,” Mr. Chiang said.

The trend seemed to be continuing this year, he added. Assuming that their transactions in the first half of 2021 would be the same in the second, it would almost double their transaction count in 2020.

Payment methods also of course shifted. From the 21.1% e-wallet usage in 2019, it leaped to around 64% in 2020 and then around 71% in the first half of 2021, Mr. Chiang shared.

Similarly, GCash’s chief commercial officer Frederic Levy noticed that many people continue to use such technology, and this suggests that enterprises should incorporate it in their operations as well.

“It’s getting more and more obvious for any form of businesses — including the small ones up to the big, organized ones — that they need to have [a digital] form of payment proposed to the consumer,” Mr. Levy said.

Moreover, fintech would evidently make payment convenient for the consumers. “So the question is more, what reason that would push you not to jump fintech if you are a small business,” he expressed.

Fintech for small businesses

As such, Mr. Levy later shared his advice for small and medium enterprises on adopting fintech solutions.

“From an MSME perspective, simplicity and onboarding clearly are a critical component because it will look for a provider who can propose you an all-in-one solution,” he said.

“Make sure that you are going after the payment solution that makes sense for your business, and also going for the widest audience possible,” he added.

Similarly, PayMaya’s chief product officer Mitch Padua also suggested that MSMEs, or enterprises in general, should look for the widest reach in terms of various payment types since second-guessing what consumers will have is difficult.

“[Look] for a partner that can provide all types of payment, whether it’s online or offline, sometimes your business can have a mix of both. It’s very hard to reconcile if you have different terminals, payment gateways, [and] partners for each type of payment,” Mr. Padua said.

Another thing for MSMEs to look at is competitive rates. “At the end of the day, each partner or payment solution will have different rates. And someone that can help you lend all of those payment types into one simple rate will make your life a bit easier,” he added.

The growing presence of these digital payment solutions will be exponential, Mr. Padua also remarked. And according to him, PayMaya, with its end-to-end digital financial services platforms for merchants and consumers, is positioned to drive such growth through several factors.

Among these factors is that merchant payment is the next trillion-peso segment. “Accelerating business to consumer, business to business, and business to government payments is where PayMaya commits to address. Over the short term, we’re coming up with exciting innovations to make sure we can seamlessly enable businesses to send payments to other businesses and individuals by offering solutions that capture settlement, all the way down to disbursement, and to encashment,” Mr. Padua shared.

Another factor is that everyone can now become a digital entrepreneur with the transformation of MSMEs on the ground, he said. “We’ve begun the digital migration of our Smart Padala agents to become a one-stop-shop for digital financial services. So beyond remittance, they can now serve as agents for digital payments, digital lifestyle, and digital banking services,” he added.

Fintech’s growth

Likewise, Frost and Sullivan’s ICT and fintech head Shailendra Soni believed that fintech will continue to grow and thrive in the Philippines.

Though Mr. Soni deemed that the revolution started slightly late in the Philippines compared to its neighboring countries, he was certain the country will nonetheless catch up.

“There will be more and more [fintech] services launched [that are] particularly putting consumers and enterprises at the center to make them pay better, save money, invest money, and insure themselves,” he said.

When people began to experience these digital payment services and eventually realize the benefits, Mr. Soni considered that the migration to more fintech-related solutions will also start.

“I believe there is going to be infrastructure on the Internet that will become much better. There will be policies, rules, and regulations in place that will further accelerate the overall adoption of fintech. There’s no U-turn; it’s going to grow,” he added.

This session of BusinessWorld Insights was presented by Tata Consultancy Services and GCash with the support of Globe, InLife, and PayMaya.

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