They say that the biggest challenge for the wide adoption of technology is for the uninitiated to try them. Clearly, this barrier has been brought down significantly by the pandemic. The current crisis has given us the impetus to increase the use of technology and re-shape businesses. With technology, we are now able to bring our work to our homes and have access to essential goods and services within the confines of our homes.
But more than the increasing number of users of digital services, the adoption of technology-based services introduces business and income opportunities to a broader segment of the population, especially those in the lower bottom of the pyramid. Through digital platforms, they can have access to affordable financing and capital, possess the capability to reach out to a bigger market, increase sales through group marketing, and tap systems that provide efficient logistics support.
These are areas where small and medium-sized enterprises have difficulty scaling up because they do not have enough capital to build the traditional brick-and-mortar stores. Moreover, transactions can be completed in a few clicks on the computer or mobile phone.
This was the focus of the summit recently held by the Shareholders’ Association of the Philippines (SharePHIL) entitled “From Bricks to Clicks: Thriving in the Digital World. The presenters included Al Panlilio, Smart president and CEO and PLDT Group CRO; Ernest Cu, Globe Telecom president and CEO, and Hans Sicat, ING Philippines country head. It also featured a sharing of ideas and insights by a panel of industry leaders: Ray Alimurung, Lazada Philippines CEO; Paolo Azzola, Paymaya COO, Martha Sazon, GCash president and CEO, and Grace Vera Cruz, Grab Philippines country head.
Boosting internet speed, connectivity
In opening the program, SharePHIL chairperson and Maynilad CEO Mon Fernandez remarked how the telecommunications industry has been crucial to timely and relevant information. Improved connectivity has enabled the rapid growth of digitalization and facilitated the shift from in-person to online transactions, bolstering consumer spending.
The telecommunications sector has made strides despite the challenges of the pandemic. In his talk, Mr. Panlilio discussed network services as the backbone of the economy, stating that “transitioning to the new digital reality requires internet speeds to increase and coverage to expand. Further investments in infrastructure such as 5G network, sub-sea cables, telco networks and towers will secure the future for the country in this digital world.”
The rise of digital finance
Data from the Bangko Sentral show that the Philippines remains one of the heavily unbanked countries in the world. During his discussion, Mr. Sicat talked about how embracing innovation can help drive inclusive growth. This, he said, could be achieved when there is increased interconnectivity adding that “The financial system is the lubricant of the real economy and there is a need for interconnectivity, as a precondition. Banks and financial systems are responsible for providing liquidity and related financial services that are important to end-users.”
To help facilitate easier mobile banking, Mr. Sicat said that banks must always be on the lookout for innovative financial solutions. Today, he said that there are different front-end apps in different industries and when these are utilized, users benefit from faster turnaround time, security of data, and improved transparency.
In his presentation, Mr. Cu shared that “Economically, there’s the issue of work stability when it comes to the Filipino investor, and the high minimum for investing. One of the most difficult barriers to overcome is the lack of awareness and education in terms of investment options, but we now see opportunities to get Filipinos into investments and mobile finance as they gain trust in these services.”
E-commerce for everyone
In the e-commerce industry, strides made in mobile banking and digital payments have stirred growth in online transactions. During the panel discussion, Mr. Alimurung highlighted that ramping up e-commerce and financial initiatives will not only do good to individuals, but it will also help small businesses drive company growth. “The digital economy is the great equalizer, democratizing opportunities for everyone, especially micro, small, and medium enterprises or MSMEs. Today, MSMEs can access market resources previously available only to big companies,” he said.
Mr. Azzola said that it is not only big enterprises who have the capacity to blur the digital divide. Small business owners can also help to address the issue. He shared, “When there is comfort of doing transactions via a mobile phone, small businesses like sari-sari stores can help break barriers between the unserved and other people and companies who have access to digital platforms.”
Cashless transfers have also become a need since the pandemic set in. According to Ms. Sazon, this mode of payment has promoted inclusivity among people from all walks of life – from office workers, companies, and enterprising Filipinos to fisherfolk and vendors. The shift to digital has, likewise, opened convenient avenues for business opportunities and measures to help in government-led initiatives. For example, e-wallet providers have teamed up with government agencies in the disbursement of social amelioration funds.
Ms. Vera Cruz cited that one of the most used digital services by consumers today is delivery service. She agreed with her co-panelists that financial inclusion and other digital services are all important to help consumers and businesses navigate through challenges in the pandemic. She was quick to add that underlying all these digital services is one value that all Filipinos are familiar with – the spirit of bayanihan. “Leveraging Grab’s platform and technology to help Filipinos overcome their daily struggles, particularly during the pandemic and helping Filipinos achieve the government’s long-term goal of socio-economic recovery. It is our social mission – to serve the Filipinos in however way we can,” she said.
Moving forward in the new normal
All the speakers in the summit agreed that virtual banking and e-commerce will become the norm and a standard practice in the Philippines. In a post-pandemic world, gaining the trust of consumers, ramping investments in infrastructure and promoting inclusivity through improved financial and e-commerce services must be prioritized by the telecommunications, banking, and e-commerce service firms to not just drive economic growth, but also to help businesses thrive and meet increased public demand in the new normal.
In closing the program, SharePHIL president Jimmy Ysmael said that “the democratized access to these services for all Filipinos, regardless of income class, have allowed Filipinos to go about their daily lives using these new channels. In the process, these have spurred increased economic activity despite the pandemic and fostered inclusive economic growth that allowed even MSMEs to continue doing business and flourish. These innovations and breakthroughs will permanently change the business landscape in a post-pandemic environment and will lead to an accelerated pace of economic development and more inclusive economic growth, moving forward.”
Marivic Españo is the chairperson and CEO of P&A Grant Thornton and a member of SharePHIL’s Board of Trustees.
To know more about SharePHIL, visit www.sharephil.orgs