Scaling phygital

BYTES - Lito Villanueva - The Philippine Star

“Phygital.” This term may sound alien to some, but to many in the fintech and banking industry, this word is a key step to bridge our way toward the digitally and financially inclusive future we envision for the country and for every Filipino.

Phygital fuses the words “physical” and “digital.” A hybridized word to mean technological innovation with human assistance and aims to bring together the best features of both.

Millions of Filipinos from rural communities are still unbanked and underserved. They struggle with accessibility, technological barriers, and living in geographically disadvantaged locations where banks and other financial services are not available. Thus, bringing financial technology to them in the least intimidating way is through phygital services. It’s banking technology with the warm human touch, to give them the TLC (tender loving care) they deserve.

At the core of everything we do is empathy. It’s the secret sauce in developing relevant and meaningful products and services. This has been the motivation behind the creation of the first-ever Tagalog-English/Cebuano financial inclusion mobile app DiskarTech and the first kapitbahay handheld ATM, i.e, ATM Go. Innovation is nothing without empathy, and our success is hinged on our drive to make Filipinos’ lives easier, safer, and more convenient.

A few weeks ago, we formally launched our latest and biggest initiative yet – MoneyBela: Barangayan Banking, the country’s first mobile human-assisted remote banking service that brings financial services to Filipinos in over 42,000 barangays nationwide. This innovation is supplemented by the TLC of our helpful and accommodating MoneyBela BES or Banking Experience Support agents. It is phygital in action.

With key partners, such as the local government units -- particularly the Liga ng Barangay sa Pilipinas, rural Pinoys can now access the same services offered by physical banks, such as basic deposit account creation, bill payments, e-load, cash in or cash out, micro insurance, and telemedicine purchase via DiskarTech, among many others. This project sustains our continuous push to create an inclusive financial ecosystem in the country.

Aside from our MoneyBela BES agents going around various communities nationwide to directly serve unbanked Filipinos, the Moneybela electric tricycles will be stationed in public transport terminals, public markets, schools, barangay halls, and health centers to make it accessible to as many people as possible.

It’s the perfect mix of efficiency, convenience, and human connection. Best of all, it will help Filipinos overcome their struggles with connectivity issues, and their challenges with using smartphones and mobile banking. With MoneyBela, it is fully equipped and independently connected to enable us to offer our financial services to every Filipino wherever they may be, and connect them with the banking system.

A successful phygital initiative must be instantly and consistently connected and engaging. The way we interact with our customers should feel like a two-way conversation. When they talk, they know that we listen and respond. We not only help them open accounts, but we also offer livelihood opportunities and services to aid family welfare – because we do community immersions, we listen, and we empathize.

Phygital is critical for the future of banking because it highlights the impact of human connection and togetherness. We’re not just telling our kababayans what to do through a screen – our agents are actively seeking them to establish meaningful connections, which is the foundation of any trusted partnership. This initiative particularly resonates with Filipinos because of our communal and emotionally-driven culture.

Filipinos are among the most emotional people in the world, according to a Gallup 2018 Global Emotions Report. In an interview with ABS-CBN, sociologist Clifford Sorita said that the Philippines ranked high because Filipinos are very “in touch” with their emotions and do not hide behind them. This is considered an advantage because our culture thrives on the strong social support of family, friends, and relatives, which “allow us to share how we feel.” The National Commission for Culture and the Arts (NCAA) also released a 2021 study on Filipino Values, which indicated that the top values Filipinos share are family, education, basic needs, health and wellness, and work and livelihood.

This help validates our efforts of combining the empowering features of digital technology and meaningful emotional connections to create customer-centric solutions in developing our services. MoneyBela is a banking service with the heart.

Both Finance Secretary Ben Diokno and BSP Governor Philip Medalla lauded the MoneyBela initiative for “bringing more Filipinos into the fold.” But more than producing ground-breaking innovations for the country’s underserved sectors, MoneyBela and our other innovations simply show that the future of banking requires human-centric and empathy-driven design. With this, we are able to provide the above-standard services that every Filipino truly deserves, while honing genuine personal relationships in the process.

RCBC’s latest inclusive innovation is in sync with the government’s nationwide support for the National Strategy for Financial Inclusion and the realization of the Digital Payments Transformation Roadmap, with its twin outcomes of converting at least 50 percent of retail financial transactions to digital and having 70 percent of adult Filipinos to have transactional accounts and be part of the formal financial system. It perfectly aligns with the environment, social, and governance (ESG) framework within the United Nations’ sustainable development goals.

Financial institutions must always remember that at the end of the day, technology is not used primarily to impress. It is a tool to express our empathy, by helping us develop meaningful products and services for the people we serve.

Lito Villanueva is the Philippines’ award-winning thought leader on digital transformation and inclusive digital finance.  He is the executive vice president and chief innovation and inclusion officer of RCBC. Concurrently, he is the chief digital transformation advisor for the Yuchengo Group of Companies. He is also the founding chairman of Fintech Alliance.ph, the Philippines’ largest organization of startups and unicorns that collectively generates over 90 percent of digital transactions volume in the country today. He was recently elected global chairman of the South Africa-based Alliance of Digital Finance Associations. Among his 100 accolades include being named among the Top 100 Fintech Leaders in Asia, and Top 100 Filipinos on LinkedIn, Mr. Fintech of the Philippines by BizNews Asia, and Chief Innovation Officer of the Year by The Banker.

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