MANILA, Philippines — Aboitiz-led Union Bank of the Philippines is banking on micro, small, and medium enterprises (MSMEs) to bring in P4 billion in new business lines and deposit accounts through a wholesale lending approach.
Mon Duarte, head of transaction banking and platform development at UnionBank, said the bank has more than 10,000 MSME leads from its current and target anchors.
With Supply Chain Finance, UnionBank gets access to a robust lead generation mechanism that hits multiple businesses including deposits, cash management, loans and online and digital transactions.
“As we started exploring blockchain use cases, we realized that its immutability and provenance can help mitigate risks for the bank when lending to MSMEs,” Duarte said
UnionBank has already facilitated more than P11 billion worth of invoices and provided almost P6 billion in loans for almost 19,000 invoices across almost 400 businesses in just a year of its commercialization.
UnionBank reported that the Supply Chain Finance platform has well exceeded the targets.
“With the Supply Chain platform, UnionBank has introduced an effective wholesale lending strategy packaged with a retail account and online and app banking enrollment,” Duarte said.
The platform also allowed the bank to lend effectively to MSMEs and to the agriculture industry as mandated by the government.
“UnionBank continues and will continue to develop new features and products on the platform to further deliver on its digitization and SME lending objectives,” Duarte said.
He said traditional and manual financing processes, that have once been effective pre-pandemic, now pose challenges to businesses as they restart their operations in the new normal.
“With the right financing technology, delays and errors they previously encountered can now be overcome and overall operational efficiency can be achieved,” he said.
With the commitment of innovating the country’s business ecosystem, UnionBank developed its own integrated supply chain financing platform, allowing businesses to confidently operate no matter the economic landscape.