Digital consumer lender eyes 10-fold jump in disbursements

MANILA, Philippines — Digital consumer lender AsiaKredit is looking at a 10-fold increase in its loan disbursements through its mobile lending platform in the coming months after tagging the Philippines as an important market.

Michael Singh, co-founder and CEO at AsiaKredit, said in an interview with The STAR the company aims to disburse between $5- to $10-million worth of loans through a mobile application dubbed “pera247.ph.”

“In only a few months of operations, pera247.ph has leveraged its digital technology to process over 100,000 applications already, and it plans to grow its loan disbursements exponentially in the coming months,” Singh said.

In its pilot stage, AsiaKredit has released $1 million worth of loans.

The digital lending solution provides unsecured small-ticket, short-term consumer loans for up to 90 days to the country’s underbanked population with no existing credit or collateral history.

Singh said the Philippines ranks among the lowest in the world in terms of bank account and credit penetration for its citizens.

“There are only approximately 15-20 million bank accounts in a country with 70-80 million Filipino adults. Worse, there are only approximately three million unique credit cards, yet we know that seven of 10 Filipino adults borrow, mostly from family and friends, or informal lenders, and only one of 10 borrow from formal institutions,” he added.

He said the unbanked and underserved in the Philippines have no choice but to play catch up.

“Economies are growing and the use of technology is upending the way we live, work, and play. The unbanked cannot get left behind while the rest of the developed world progresses and benefits from this digital age. They need to be included into the financial system and digital technology can help us achieve this,” Singh said.

He said mobile lending platforms such as pera247.ph could play a role in transforming financial inclusion for the lower income groups that previously had no access to credit through traditional banking channels as one in two Filipinos own a smartphone.

The Asian Development Bank (ADB) estimates that digital finance could boost the gross domestic product (GDP) of the Philippines by about three percent, lead to more than $4 billion in additional credit uptake, and mobilize more than $7 billion in savings.

Singh said pera247.ph enables the unbanked populations to apply for loans through mobile lending apps that use data-driven credit assessment tools to analyze smartphone behavioral data and other alternative sources of data.