Subs Spotlight – UBX and City Savings Bank
Accelerating the digital future with UBX
UnionBank’s wholly owned fintech and innovation arm, UBX has always been hub of an ecosystem of digital channels and platforms – from incubation to induction. These platforms provide opportunities and enable financial inclusion for the underserved individuals and small businesses across the country.
Phenom had an opportunity to have a look back at 2020 in general with UBX’s President and CEO, Mr. John Januszczak.
Phenom: 2020 has been a challenging yet interesting year. Looking back at the year's events, what were the highlights and learnings?
John: Rapidly changing behaviours because of the pandemic resulted in consumers embracing digital channels and platforms. At the same time, COVID acutely affected MSMEs who have always been digitally and financially underserved. Small enterprises needed access to digital services as a matter of survival. UnionBank, UBX and the member financial institutions of UBX’s i2i platform were all uniquely positioned to provide assistance to the country in this time of need.
At the same time, uncertainty at the beginning of the pandemic necessitated financial and delivery discipline while being forced to adopt completely new ways of working. Many of the top technology companies of today were formed out of the 2008 financial crisis. Out of crisis comes both hard fought lessons in discipline and opportunity. 2020 has definitely made UBX and the UnionBank group more disciplined. This is our time.
The significant opportunity that stands before us cannot be seized with the same level of investment, thinking, and execution we had at the beginning of 2020. We require a different sense of urgency – from one of playing our part in supporting our country during the pandemic – to one of accelerating a clearly digital future.
The world has changed. We must change. One of the things that limits our learning is the belief that we already know something. What got us here will not get us to where we need to be. As UnionBank’s Vice Chairman Tito Ortiz has often said, "we must unlearn and learn anew."
Phenom: We've been awarded the 2nd Most Helpful Bank by Asia-Pacific by BankQuality Consumer Survey and Ranking. We can say that we have lived true to the promise of "no one gets left behind". What are some of the initiatives from UBX that has helped deliver this promise?
John: Our i2i platform, which connects smaller financial and non-banking financial institutions to each other and the nation’s payment systems, provided the only means of digital funds transfer and payments for many of the customers of member institutions. As a result, DSWD was able to leverage the i2i network to disburse Social Amelioration Program (SAP) assistance to those in need in underserved areas.
Given the rapid change in consumer behavior, companies – especially MSMEs – had to move online out of sheer necessity. BUX, our payments platform, supports these MSMEs by allowing them to accept payments digitally from a wide and growing array of payment options & methods. For SMEs new to e-commerce, we launched Sentro which allows a merchant or seller to have an e-commerce presence and start selling online in minutes. These merchants provide critical support to the country’s economy. They need easy access to credit to sustain themselves and grow. Through SeekCap we provide a digital end-to-end lending platform for SMEs to access needed capital, at reasonable prices, from reputable lenders. Simultaneously, SeekCap provides lenders a needed digital channel to reach their borrowers.
Phenom: As we live true to our purpose of co-creating innovations for a better world by "tech-ing"up the Philippines, how do you see your unit/center/organization contributing to this goal?
John: At UBX our vision is to provide access and opportunity to all – to include the excluded. Digital platforms are achieving scale and client reach that exceeds that of traditional financial service providers – even more so during the past year. UBX is building platforms for digitally and financially underserved communities – like Sentro SMEs and i2i for community based financial service providers – while aggregating and virtualizing financial services to embed in the platforms of others – like BUX for payments and SeekCap for lending. On top of this, we are investing in other technology startups that share this mission. And to bridge any gaps in digital adoption, we are building a services organization to help organizations leverage digital platforms and a digital UnionBank. In a way, UBX = Tech-up Pilipinas.
Phenom: What growth do you envision for 2021 for your unit/center/organization and the bank?
John: Our recent acquisition of Fexco’s EasyDebit business in the Philippines doubles the size of our i2i platform. Bux is the largest aggregator of over the counter payment channels in the country. In a matter of 6 months, we have signed up over 27k online sellers and merchants to Sentro. On top of this acquisition, we expect step change increases in volume based on our current growth trajectories. We are on the look-out for further deals that would accelerate acquisition and activity. Embedding SeekCap directly into platforms such as Lazada has resulted in an order of magnitude increase in business. In 2021 we will be actively pursuing digital channel partners to drive this effect. We will likewise step up investment in external tech startups and our technology services organization.
For UBX, now is not the time to seek comfort or complacency - it is the opposite - we must embrace a big, exciting but uncertain future head-on. We have every reason to be confident. Confidence does not mean certainty - it means moving boldly forward in spite of being uncertain. After these past 9 months, if there is one thing I know now more than ever before, it is that we want, we can and we will.
Compassion and customer-centricity at the core of CitySavings
CitySavings is keeping up with the times and embarked on its own journey to become a digitally transformed mass market bank. With technology as an enabler, CitySavings was able to pass on the culture of “malasakit” to their customers integrating digital and empathy to the core.
Despite the challenges brought by the pandemic, CitySavings pursued opportunities to be more efficient and provide faster service to its customers. The launch of the Loan Ranger lending facility is instrumental in the speedy processing of loans, while the roll out of the CitySavings VISA card expedites the release of loan proceeds. The motorcycle loans business of the bank also grew with a bigger dealership network and more partnerships on loan scoring and loan financing.
In its journey to becoming the finest mass market bank, CitySavings promote inclusive financial prosperity through Petnet and its growing domestic remittance partners. The bank also made sure to give back to the community and one of its primary stakeholders, public school teachers through Project Agile, a learning series and CitySavings’ corporate social responsibility initiative that aims to equip teachers with digital capabilities and tools as they shift to the new ways of teaching. Here’s a rundown of their 2020 milestones through City Savings Bank’s President and CEO, Mr. Larry T. Ocampo.
Phenom: 2020 has been a challenging yet interesting year. Please describe 2020 in five words. What were the highlights and learnings?
Larry: 2020 has CHALLENGED me, as it has everyone else. At the same time, it has presented rare OPPORTUNITIES. It made me realize there is much for which to be GRATEFUL. The year also cast the world in stark relief that made clear one’s PRIORITIES and PURPOSE, or what matter most, and where to focus one’s time and energy.
Phenom: What's the greatest business lesson you've learned during the pandemic?
Larry: The ability to innovate to remain viable and relevant has more to do with mindset and attitude than with size or resources.
Phenom: How about the greatest personal lesson?
Larry: Take nothing for granted. Allocate time and energy to what matters most.
Phenom: We've been awarded the 2nd Most Helpful Bank in Asia-Pacific by BankQuality Consumer Survey and Ranking. We can say that we have lived true to the promise of "no one gets left behind". What are some of the initiatives from CitySavings that helped deliver this promise?
Larry: We’ve always been known as a bank that is warm and helpful towards our customers. The culture of “malasakit” is deeply rooted in our DNA as evidenced by stories on how we uplift the lives of communities we serve. This culture is further enabled by technologies like our CitySavings Visa Debit card which provides our customers a safer and more convenient way to transact online; our Motorcycle Loan ranger gives us the ability to process loan applications anytime and anywhere. Also, in the pipeline is the enhanced version of Talk to Maria which will have the ability to provide a quick and easy way for potential clients to apply for a loan. I’m also very excited with the results of the pilot launch of our CitySavings Loan Ranger mobile app which will provide teachers a simplified and easy way to apply for a reloan, while in the comfort and safety of their home. We believe that immediate online access to the bank’s financial services is most especially needed in this time of pandemic. We are gearing up for the nationwide rollout of this initiative as of this writing.
Phenom: What growth do you envision for CitySavings this 2021?
Larry: We are looking at steady growth in our core portfolio, public school teacher loans; high double-digit growth in our MC loans; and, triple-digit growth in our non-DEPED salary loan business.
Phenom: What do you think are CitySavings' contributions to the nation during the pandemic?
Larry: Two things come to mind:
We were able to continue to serve the teachers even in the strictest lockdowns in the country, and is a testament to the willingness of our people to serve, and the technology that we employ that allows us to do so.
In addition, traditional in-house financing by motorcycle dealers had been severely curtailed during and after the lockdowns. We were able to step up and fill in the huge demand for motorcycle loans needed for socially distanced, convenient, and affordable transport.
Phenom: CitySavings is on its way to becoming a digitally-transformed mass-market bank. How do you think did the transformation prepare CitySavings for this pandemic?
Larry: City Savings has always been very customer-centric, and is the main reason it is a dominant market leader in the DEPED loan space.
I’ve learned that customer-centricity is essential as one digitally transforms. There will always be new ways of doing things better, but they only matter if they translate into a real improvement in customer experience.
One vivid example stands out. Our sales force is the only one equipped with tablets that allow for a completely paperless and mobile loan application. This tablet provided our sales teams with the advantage of speed, convenience, and flexibility as opposed to their counterparts.
Our sales people, very mindful of the teachers that needed emergency loans, went out at the height of the lockdowns to serve their clients. The teachers were grateful that we could still process their loan requirements, more so that we could do so in the safety of their homes.
This kind of service deepens our connections with our customers and allowed for a rapid recovery post-lockdown.
With UnionBank and its subsidiaries, UBX and CitySavings, customer experience is the key driver of digital transformation. Developing products, services and platforms with the interest of customers at the center enabled both businesses to turn the challenges of the pandemic into opportunities to include everyone and build lasting relationships through the moments that matter to our customers.