Digital adoption chance to ‘tech up,’ build up PH–UnionBank

Money changing hands became risky behavior because of COVID-19 so Filipinos promptly jumped online for financial transactions.

“The pandemic broke through the inertia of digital adoption,” said Justo A. Ortiz, UnionBank of the Philippines vice chair in “Brand Digital Pilipinas: The New People’s Revolution,” a discussion at the Singapore Fintech Festival (SFF) held in December 2020. SFF is the world’s biggest fintech event.

Protocols and lockdowns evolved the financial ecosystem. Enterprises went online because brick-and-mortar stores closed. Homebound people accessed services, paid bills and transferred funds through Web-based platforms.

The pandemic fast-tracked digital transformation from five to one or two years, Ortiz noted. “So now we have a real opportunity to ‘Tech Up Pilipinas’ one industry vertical at a time, one company at a time, one person at a time.”

In Tech Up Pilipinas, UnionBank is using technology to increase efficiency, reduce costs and improve customer experience. Since kicking off the program in 2016, it has launched EON, the first selfie-banking in Asia that integrates facial recognition technology; The Ark, the country’s pioneering fully digital bank branch; and Chatbot Rafa, the country’s first banking chatbot. Two years into the effort, Euromoney said the bank had the best transformation in Asia.

But the goal is much bigger. Seeing technology for its potential to make opportunities accessible to more people, UnionBank also guns for financial inclusion. It wants digital tools to empower unbanked Filipinos (some 70 percent of the population) and micro, small and medium enterprises (about 99 percent of local businesses). The ultimate goal is sustainable development that propels the nation for a G20 seat by 2050.

To enable the nation’s underserved, the bank has collaborated with the Monetary Authority of Singapore and other institutions. It made history when an account holder in a rural bank in Cantilan, Surigao del Sur, received money via OCBC Bank Singapore. That countryside bank is one of 125 in an i2i network that can now receive and send money worldwide via blockchain.

UnionBank went digital out of a “visceral feeling of existential threat,” hoping that high Internet penetration and usage in the country would turn into an opportunity, recalled Ortiz. Tech Up Pilipinas soon raked in recognition for the bank.

The accelerated digital adoption only makes UnionBank’s industry advantage clearer at this point. BankQuality declared it the second-most helpful bank in Asia-Pacific during the pandemic. Digital transactions grew exponentially because of 24/7 services. On a larger scale, UnionBank has helped the government get aid to thousands of Filipinos. Fintech spinoff UBX helped thousands more by providing helpful assistance to people and MSMEs. UnionBank ended up as the Philippines’ Bank of the Year in The Banker’s 2020 list because it “outshone its peers in terms of performance, strategic initiatives and response to the COVID-19 pandemic.” It does not intend to go solo in the mission to “tech up” the country, however. Ortiz invited other firms to capitalize on the digital adoption and create “a sustainable, inclusive, world-class and competitive economy. INQ