It may look anticompetitive on the surface, but it really isn’t when one takes a closer look at it.
We’re talking about the proposed merger of BancNet and Philippine Clearing House Corp. (PCHC) which is currently being reviewed by the Philippine Competition Commission (PCC).
BancNet and PCHC are the clearing switch operators for InstaPay and PESONet facilities, respectively—services that are used by Filipinos for sending money from one entity to another.
InstaPay and PESONet technically operate in the same market, but there are key differences between these two that make them totally distinct from each other. InstaPay is for transactions up to P50,000, while there are no transaction limits for PESONet. InstaPay transactions are executed almost instantaneously, but PESONet transfers can take longer (up to a few days sometimes) for the money to be transferred to one account from another.
As such, InstaPay and PESONet are geared toward different markets, with the former more suited for retails users and consumers, while the latter is more useful for business-to-business transactions.
Because of these key differences, banks cannot just switch from InstaPay to PESONet and vice versa.
It may look like a merger would be anticompetitive because only one player will be left standing, but in truth, it will not curtail competition because, simply put, there is none. InstaPay and PESONet do not compete with each other.
Naturally, there are concerns that the combined entity would lead to higher costs for consumers in the form of more expensive fees, lower quality of service and less innovation, since only one player in the market will remain.
But it must be stressed that it’s the banks themselves (and neither BancNet or PCHC, as switch operators) set fund transfer fees. And there is an ongoing trend among banks to reduce fees to attract consumers. In fact, some banks have waived fees for transactions of up to P1,000.
Regulations of the Bangko Sentral ng Pilipinas also ensure proposed fee increases are rigorously reviewed before being approved.
For consumers, nothing much will change should the BancNet-PCHC merger proceed. In fact, it can even benefit from better services given the combined entity will have more resources for capital expenditures.
Shareholders of both entities have already approved the merger, citing potential operational efficiency gains. But will the zealous Philippine Competition Commission see it this way and allow the deal to proceed? Abangan!
— Daxim L. Lucas
New PAL marketing VP
Flag carrier Philippine Airlines has added a new name to its top management with the appointment of Alvin Miranda as its new vice president for marketing effective last Nov. 14, bringing with him 18 years of global marketing expertise in the food and beverage, beauty and pharmaceutical industries.
Miranda began his marketing career at United Laboratories then moved on to Pepsi Cola Products and Del Monte Philippines. He then spent seven years at L’Oreal Paris.
Then in 2019, Miranda, a Business Administration graduate of the University of the Philippines, moved to Mondelez International as head of marketing based in Thailand. Just prior to moving to PAL, Miranda was named “Thailand Marketing Leader of the Year”.
PAL’s hope is that despite having no experience in the highly competitive airline industry Miranda, can still work some marketing magic to help make the 82-year-old PAL “a stronger global brand.”