Bank plans to onboard more SMEs with app

A bank led by the Aboitiz clan launched last Tuesday a digital platform targeting to onboard small and medium-scale enterprises (SMEs).

Union Bank of the Philippines President and CEO Edwin R. Bautista said they plan to onboard 1 million SMEs into all its digital platforms in the next few years.

“It is an ambitious number but we believe it is doable,” he said. “This is part of our commitment to ‘tech up’ the Philippines.”

Currently, there are 175,000 businesses—with asset size of less than P10 million—who have shifted to the bank’s digital channels, according to Bautista.

UnionBank shares climbed by 0.14 percent, or 10 centavos, to close at P71.10 each amid the 0.07-percent drop for the benchmark index on Tuesday.

UnionBank already has a digital platform for corporates. But, Bautista said, they came to a conclusion that SMEs have different banking needs compared to bigger companies. This prompted the bank to develop a new financial platform to address their requirements.

“We have developed a digital solution that has full digital capabilities such as real end-to-end online account opening process,” UnionBank Vice President for SME Segments Jose Paulo R. Soliman said, noting it was critical to have a solution designed for SMEs.

Soliman explained the application allows users to open online stores and track inventory. At the same time, it offers basic banking transactions, including balance checking, fund transfers and check deposits.

The SME banking platform is also designed to manage multiple businesses even by just submitting a single set of credentials, UnionBank Vice President Antonio Miguel D. Dans said.

“A lot of business owners don’t just have one business,” Dans said. “A lot of the time, these entrepreneurs—I guess—are really creative, so they end up thinking a lot of businesses.”

Amid the digital shift, the UnionBank chief observed that SMEs—comprising 99 percent of all the businesses in the country—were able to adapt to the so-called new normal, transitioning to e-commerce during this pandemic. With this, Bautista reiterated that SMEs should be given help to further bounce back as they are among the hardest hit sectors.

“If done properly, they would be the engine that will sustain the continued growth of the country,” he added.

UnionBank also offers other SME banking products that extends loans and provides one-stop-hub digital platform for small businesses.

The Aboitiz-led bank saw its net earnings slip by 0.9 percent to P8.5 billion in the first nine months of 2020 amid higher provisions for potential loan losses.

Earlier this month, UnionBank announced it was aiming to establish the first known “data science factory” banking model in Southeast Asia’s financial industry. The said model will boost the listed bank’s business management, improve its internal processes and enhance end-to-end perspective of all operations.

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