10 New Philippine Fintech Startups to Watch out for in 2019by Tom Noda December 21, 2018
Financial technology continues to bring exciting times ahead in the Philippines with the ever-growing emergence of new fintech players that aim to cater to 69 per cent of its adult population that are still unbanked.
Citing one industry report, Philippine central bank governor Nestor Espenilla noted recently that fintech startups in the country reached 60 players last year, dominated by mobile payment and alternative finance firms with 26 and 17 players, respectively.
Latest statics showed Philippine population size reached 105.7 million with 46.1 per cent as smartphone users. Smartphone and internet access can allow anyone avail of financial products and services offered by fintech startups even without having a traditional bank account.
“The transaction value of the fintech market in the Philippines is estimated to amount to US$5.7 billion in 2018. It is expected to grow at an annual rate of 16.4 per cent. By 2022, the fintech market in the country is projected to amount to US$10.5 billion,” Espenilla said.
Below is a random list of new fintech players whose business performances can be interesting to watch in 2019.
First Digital Finance Corp. (FDFC)
Claiming now to be a “fast growing company”, Manila-based fintech firm First Digital Finance Corp (FDFC) is surely an interesting team of financial innovators to watch in 2019. Founded by Georg Steiger in 2015, FDFC has already produced three local fintech platform brands BillEase (installment plans for online shopping), Loan Ranger (online cash advance), and Balikbayad (digital financial facility for overseas Filipino workers). FDFC leverage AI or artificial intelligence and digital processes.
FundKo is local P2P lending business launched in 2016 that runs a crowdlending platform connecting verified lenders and borrowers. It is a subsidiary of Guevent Investments Development Corporation (GIDC), a multi-chain and multi-billion peso company headquartered in Mandaluyong City. FundKo is partner of Grameen Foundation, and JP Morgan. FundKo connects a crowd of lender investors who are ready to fund qualified borrowers at lower rates and flexible terms, to offer monthly payments. Its loan products are personal, maternity, cashback, business, and working student loans.
Global Overseas Worker (GOW) is a new crypto and fiat exchange licensed by the Securities and Exchange Commission (SEC), and the Banko Sentral ng Pilipinas (BSP) in the second quarter and third quarter of 2018, respectively, operating under the license of its subsidiary ETranss Remittance International Corp (ETranss). GOW seeks to link traditional finance and cryptocurrency in one exchange by serving as a liquidity bridge. Its products right now are overseas remittance and assets exchange.
Philippine Digital Asset Exchange (PDAX)
Touted as the first crypto-trading platform built for Filipinos, Philippine Digital Asset Exchange (PDAX) is the latest blockchain-enabled startup issued with the central bank VCE license. PDAX is working on its online, open marketplace for cryptocurrencies meant to facilitate the exchange of Philippine Peso with cryptocurrencies, tokens, and other forms of virtual currency, like Bitcoin, Ethereum, Ripple, Bitcoin Cash, Litecoin, and other locally in-demand coins. Blockchain influencers Nichel Gaba, Krystian Kucharzyk, and Yang Yang Zhang co-founded PDAX in 2017 under a legal entity name Fyntegrate Incorporated.
The fact that agriculture is seen as high risk, it will be great to observe how crowdfunding platform Cropital will connect farmers and investors throughout the wet and dry seasons in the Philippines on 2019. Cropital helps farmers access low-cost sustainable financing. Through its online platform, investors are asked to choose a farm or farms (screened by Cropital) to invest in. Once the farm has been fully funded, the farmers will be provided with the resources they need to start farming. The funds and resources will then be utilized to improve production. Cropital manages the fund for the farmer making sure it goes to the right resources, assuring as well that investors will get a return on investment.
Launched in 2017, Uploan targets the salary deducted lending market, offering institutional and retail investors an alternative way of investing. Pension funds, trusts, non-profit and for-profit corporations, and hedge funds — can participate on its platform, including individual investors. Through Uploan’s platform, investors are made to commit funds towards different risk criteria and loan maturities for loans secured against an individual’s salary. Returns are then repaid through the person’s payroll deduction as Uploan has partnered with the individual’s employer. Investors can review the different loan returns then select the loans they want to invest in.
Bagging mutiple wins in the 2018 Asean Rice Bowl Startup Awards, online tax filing startup Taxumo is a promising group to watch in 2019. The end-to-end online tax assistance platform was recognized as the Best Newcomer, Business Automation Tool, and Fintech Startup in the recent contest. Taxumo believes in empowering freelancers and business owners to focus their time and energy for their passions and businesses instead of worrying about taxes. The startup’s web and mobile-responsive application enables its users to file and pay their taxes in minutes, anywhere and anytime. Taxumo was also recognized as one of the social enterprises of the first batch of the Social Impact Accelerator, which is one of the initiatives under the Innovation for Social Impact Partnership (ISIP) project co-implemented by PhilDev Foundation and UNDP Philippines, with support from the Australian Government Department of Foreign Affairs and Trade.
Payo is a COD (cash-on-delivery) gateway for e-commerce platforms designed to simplify COD. Founded in 2016, the startup provides a suite of technological solutions enabling buyers to reduce cancellations and increase revenues and allowing the merchant to gain a clear understanding of the entire process. Among its four main services is early remittance in which Payo will deliver the payment to the merchant already even if the courier is not remitting yet. Payo believes this results to positive cash flow and the merchant would easily monitor all his remittances. Payo’s founders Ofri Kadosh and Liron Gross envision the company to be a household name for COD, providing reliable payment option for online sellers who want to scale up their business while gaining trust from their customers.
Several industry sources are betting on Perajet as a local fintech startup to watch in 2019. It specializes in lending offering micro-finance services in many places in the Philippines. Backed by funders from the European Union – WJA Investments, Payo started in early 2018 and is registered with Security Exchange Commission. Its focus is to offer fast, short-term on-line loans to private persons.
Another fintech startup that can be awesome to watch in 2019 is Pearl Pay, a mobile tech wallet enabler founded in 2017 by Spark Perreras. The startup seeks to empower institutions in the Philippines like the rural banks, schools, pawnshops, sari-sari stores, gasoline stations and other MSMEs with world-class mobile wallet payment technologies and a profitable revenue share model. It also wants to help micro-entrepreneurs find new business in the remittance market and position the Philippines in the fast-paced cryptocurrency arena. One of Pearl Pay’s product is its mobile wallet white-label product designed to allow rural banks to launch their own virtual prepaid MasterCard and Pearl Pay account. The company also has its mobile wallet co-brand partnership that can allow universities to issue their own virtual prepaid Pearl Pay/MasterCard accounts as well as MasterCard EMV chip cards.
Featured image credit: Edited from Unsplash