BY: CORA LLAMAS
IDC Financial Insights unveiled a list of 10 fast growing fintechs in the Philippines, part of the broader FinTech 101 list for Asia/Pacific, at the FinTech Innovation Summit 2017 held at Shangri-La at the Fort, Manila. “IDC’s FinTech Fast 101” refers to the fast-growing fintech players in Asia/Pacific based on extensive on-ground analysis of the dominant fintech players within the region.
IDC’s fintech list makes a reference to the “Triple U” framework — ubiquity, utility, and usability. This is an efficient global framework, which evaluates data from many key metrics such as addressable market, customer adoption, investments, chance of survival, innovation, and marketing. IDC Financial Insights believes that newer categories that are gaining traction include digital identity and authentication, bitcoin and other cryptocurrencies exchanges, robo-advisory, credit analytics and scoring, and usage-based insurance.
“It’s very interesting to see the rise in public-private partnerships within the fintech domain in the Philippines. This is unique for the Philippines, with many non-government financial institutions that are favoring collaborating with fintechs to address the needs of current and potential customers. The disruption is largely visible in payments including remittances and money transfers. Six out of the top ten fintechs we identified are in the payments space, pointing to a huge underserved market in the Philippines. We expect players in payments to expand into m-commerce as a viable growth strategy,” remarked Michael Araneta, Associate Vice President for IDC Financial Insights.
“The role of giant telco players such as PLDT and Globe Telecom need to be highlighted as they have wholeheartedly adopted the FinTech mindset and launched their own innovation units to improve financial products and services. Fintech in the Philippines has a huge target market ranging from the overseas Filipino workers (OFWs), a rapidly growing middle class, and large local unbanked population in far-flung areas. These FinTechs rise from the third platform and provide more novel and nimble ways in terms of accessing to financial service via smartphones. Their burgeoning partnerships with banks and insurers have paved the way for more financial inclusions and better economic opportunities”, adds Jubert Alberto, Head of Operations at IDC Philippines.
“Though the country is still at the early stage of fintech adoption compared to other ASEAN neighbors, fintech in the Philippines need to be more aggressive and move swiftly both locally and regionally. IDC Financial Insights expects that 2018 will be a banner year for Asia/Pacific fintech to regionalize – similar to the journeys of Alipay and Grab – and the ones who will be able to achieve scale and ubiquity,” Araneta said.
This FinTech 101 list is published in continuation of IDC Financial Insights’ 2017 fintech report series, which helps investment groups, financial services institutions, and technology players in understanding the fintech landscape and identify potential fintech players for investment and collaboration. For this research, IDC’s definition intentionally excludes licensed banks and other licensed financial institutions that are using new technologies to radically change financial services, even to the point of launching their own fintech companies and brands. The idea is to look at the fintech players outside of traditional services.