In the Philippines, only 8.1% of people who are employed have credit cards, according to World Bank data from 2021. The majority, or 80% of retail transactions carried out by the nation’s 113 million people, still involve cash notes.
The Philippines, a historically cash-dependent country with a 66% unbanked user population, has made great strides in the digital transformation of its payments infrastructure.
Digital payment adoption rates increased from 1% to 20.1% between 2013 and 2020. COVID-19 had a significant impact on the decision of many Filipinos to conduct business from the comfort of their homes; between 2019 and 2020, the adoption of online payments increased from 14% to 20.1%.
What are the Fintech trends around BNPL and LNPL in Southeast Asia
The central bank of the Philippines, Bangko Sentral ng Pilipinas (BSP), is optimistic that the country is on track to meet its goal of having 50% of its retail volume made up of digital payments by 2023 given the rapid growth of digital payments in the nation.
To find out more about the growing usage of fintech solutions such as Buy Now Pay Later and digital payments, we spoke to Aleksey Kosenko, who leads UnaCash as its President and Chief Executive Officer. UnaCash is a financial app that provides customized financing solutions for those without easy access to banking services.
With a decade of experience in project management within the technology services industry, Aleksey
Kosenko is responsible for driving growth plans across all UnaCash products. He oversees overall
operations, sets strategic objectives for teams, and generates innovative ideas to enhance business
performance. Here’s what he had to share about their latest product in the space and how the market is evolving.
What are the key features of UnaCash’s POS loans?
UnaCash is now making it more convenient for customers to access point-of-sale loans. With the latest app update, customers can personally submit their loan applications, which provides them with greater convenience and control over financing needs. One of the standout features of this upgraded app is its emphasis on accessibility. This enables them to apply for loans directly to the app, making it even more convenient for them,, and with the assistance of marketing specialists in-store for a streamlined application experience.
Furthermore, UnaCash distinguishes itself from traditional loan providers by offering point-of-sale loans with no processing fees. The new and improved platform also caters to customers’ diverse financial needs through its maximum loanable amount of ₱50,000 (~USD 900) for larger purchases, and flexible terms beginning at three months to twelve. For merchant partners, UnaCash offers the same amount of convenience to its merchant partners. A unique QR Code is provided per merchant which serves as a store locator and store ID. Highlighting itself as a data-driven company, comprehensive sales performance reports are also given to its partners in order to better assess success metrics on a timely basis.
How do UnaCash’s POS loans differ from other BNPL (buy now, pay later) options?
Introducing point-of-sale loans is just an upgrade of our buy now, pay later services. This offers a convenient lending option to its customers upon checkout wherein UnaCash marketing specialists can personally offer this financing solution and assist them through its process in-store.
How do UnaCash’s POS loans contribute to financial inclusion in the Philippines?
UnaCash initially focused on the recorded 44% adult population in the Philippines which remains unbanked, and another 61% who relied heavily on informal loan sources. Due to the global pandemic, the growth of digital finance and fintech innovations has been a way for the unbanked population to be granted better access to financial services. This has also increased the demand for credit options like buy now, pay later (BNPL) which allows consumers to make purchases without paying the full amount upfront. This gives Filipinos the accessibility for life upgrades, and at the same time, receive financial assistance with a few easy steps. The purchasing manner has evolved and individuals are open to generating purchases through these platforms more than ever.
What are the challenges that UnaCash faces in its expansion?
The fierce competition in the local market presents a significant challenge for UnaCash. However, the team as a whole views this as an opportunity and a form of motivation to improve and grow our services as an alternative for those that have yet to be reached with formal access to credit.
Can you give us a brief overview of the Philippines loan market at this time?
Generally, UnaCash observes significant growth potential in consumer finance in the Philippines due to varied spending on goods and services, appetite for formal credit and greater activity in the e-commerce space. Both traditional and digital players such as UnaCash are competing for better visibility, better offers, and a better customer experience for Filipinos.
For BNPL, for example, growth is only a matter of time. The size of the BNPL market in 2022 can be estimated from $1.5 to $2 billion with the prospect of growing to $5.5 – $6 billion over the next five years – with embedded finance and direct integration with payment systems as main drivers.
What are UnaCash’s plans for growth in the Philippines?
The primary objective of UnaCash is to concentrate on increasing its partner merchants across the country. Alongside this, it is to continuously ensure that our product will be delivering exemplary service to every Filipino whose aim is to enhance their way of living through accessible financing. Beginning its launch this 2023 until 2024 with these two objectives in mind, the target is to rank among the top three players in the local market in terms of assets.