GCash Expands Financial Services Provides Opportunities For All
All eyes are focused on Asia, more so than ever before, and with good reason. Asian economies are well positioned for robust growth, and in recent years, Asian emerging markets performed rather well compared to their counterparts outside Asia.
Asia has made significant progress when it comes to financial inclusion. The Philippines, in fact, has the most conducive environment for financial inclusion in the region; number 4 worldwide in a 2018 study (The Global Microscope) conducted by The Economist Intelligence Unit (EIU). The study assess the enabling environment for financial inclusion across 5 categories and 55 countries. It also cites that the leading countries in the study “feature market-entry regulations that do not deter new players that serve low- and middle-income populations” - with the Philippines having banking and non-bank financial institutions and e-money issuers and cross-border payments providers actively reaching out to the population.
The socio-economic impact from financial inclusion - having formal financial products and services available to all segments of a population regardless of their economic standing - can be game changing in emerging markets. This helps unlock greater access to fundamental services, helps people create financial identities, encourage savings, and even help drive or build an economy. With technological innovations combined with the rapid proliferation of mobile phones, along with growing income levels, more platforms have emerged. One such platform is GCash.
GCash is the Philippines’ leading mobile money platform. The app is widely used for transactions with its scan-to-pay or PayQR feature. In recent years, more products and services have been added to it, like GCredit, GScore, and InvestMoney.
With GCash being mobile, the platform is able to address consumer pain points. Such pain points include the lack of cash on hand for emergencies, and the lack of documentation needed in order to open an account or credit line.
“We are trying to leverage on the platform that GCash provides,” said Jean-Francois Darre, CEO of Fuse Lending Incorporated and Mynt’s Financial Services Head. “We’re trying to embed our products to that platform and making access to credit convenient.”
In a study conducted by the Asian Development Bank (ADB), more than 40% of Filipinos rely on informal lending sources, with only 12% borrowing from a formal financial institution.
“We’re trying to make credit affordable and accessible. In the Philippines, it can be challenging sometimes for people to have access to credit because of heavy documents, requirements from financial institutions.”
Having a democratic access to credit, according to Darre, equalizes the playing field. For him, this also means that there’s a better and safer option out there that is readily available.
GCash prides itself with its vision of “Finance for All” - its products are designed for both the banked and unbanked. While it is clear that technology helps pave the way for a more financially inclusive society, GCash knows the importance of cultivating responsible financial habits. Thus, the introduction of GScore, the country’s first trust score rating.
GScore makes use of technology to assess one’s financial capacity based on data built upon by the users relationship with the app, along with key personal identifiers. With the unfounded reputation that Filipinos cannot manage finances, this feature manages to debunk that.
“It’s a trust score which Filipinos can earn,” remarked Kim Seng, Fuse’s Head of Lending. “So it’s something that they feel they earned already and can take care of.”
Seng also observed that within a few months of launching GScore, good payment behavior was indeed captured. “The Filipino can do it,” she adds. “All they need is the right finance partner.”
Lately, GCash has announced that Invest Money (its in-app investment marketplace) has gone off-beta, enabling more users to gain access to investing at a very affordable price point of PhP 50. This also helps people build up a financial portfolio and in turn, builds wealth.
The Invest Money feature also mirrors the company’s goal to provide “finance for all” as it is a product that is accessible to Filipinos from every income level, and affordable as well. It is something that one can even save up through the course of a month, according to Izza Castelo, Head of Investments.
GCash itself is evolving. By harnessing technology, more people are now able to build a financial history, regardless of their background. With the features and services that are already built in-app, more and more people are now able to participate in the economy, and for some, for the very first time to do so.
The mobile technology that platforms like GCash run on lets consumers bypass hurdles imposed by traditional banking, as it breaks down constraints by delivering greater convenience, security, and security - anytime and anywhere.
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