Driving Digital Banking Innovation in the Philippines

As the most awarded all-digital bank in the country, CIMB Bank Philippines is leading the way in banking innovation and driving access to formal banking services. We interview its Chief Executive officer, Vijay Manoharan to find out more.

To begin can you tell us a little about CIMB Bank Philippines (CIMB BANK PH)?

Vijay Manoharan, Chief Executive Officer, CIMB Bank Philippines

CIMB Bank Philippines is an all-digital mobile first bank. We pride ourselves in offering a full digital experience that is simple and convenient for our customers, allowing them to benefit from 10 minute bank account opening, zero fees, highest interest for savings and complete friction-less banking conducted with the highest level of security and safety standards.

The goal is to change the way banking is delivered in the country using technology and data by providing a trusted platform that brings real value for people to advance their lives forward. Our entry strategy in the Philippines was anchored on a platform banking strategy where we collaborate with partners to co-create joint products. Then, we leverage on our partners to extend these products and services on their platform to bring banking to more Filipinos.

Through this platform banking strategy, we are able to uniquely differentiate ourselves allowing us to grow at scale as we maintain a low cost operating model.With the simple belief that every Filipino can achieve financial empowerment with better and smarter financial choices and through our platform banking strategy, CIMB Bank Philippines has been able to achieve:

• Growing over 3 million deposit and loans customers
• Where 30% of bank account holders are first-time to have a bank account
• Where 51% of successful loan applicants are first-time bank loan applicants
• Securing 21 international awards to date, allowing CIMB Bank to be the most awarded all-digital bank in the Philippines

You are the first fully digital bank in the Philippines. What are the advantages for customers?

With CIMB Bank Philippines, Filipinos can get more value from their bank, saving them from the hassle and constraints of a traditional banking experience. Our savings account can be digitally applied all-through the CIMB Bank PH app anytime, anywhere using just one valid ID with the entire application process taking only less than 10 minutes.

We offer the highest savings interest rates of 3% – 4% interest rate per annum− 1600% higher than the country’s leading banks. On top of the exceptionally high interest rates, weprovide free life insurance to customers equivalent to their average daily balance, maximum of P1 Million. Eligible customers are also able to get a free Visa debit card that they can use in over 25,000 ATM machines nationwide and in over 46 million merchants worldwide with zero transaction fees.

We have also partnered with over 8,000 physical touch points for cash- in transactions to give greater access and convenience to customers through 7-Eleven convenience stores and Bayad Center locations.

On the other hand, we also have our Personal Loan product which allows Filipinos to digitally apply for a loan of up to P1,000,000 all through the CIMB Bank PH app. With this, we solve the hassle of requiring customers to prepare traditional documents to obtain their much-needed personal loans.

Can you tell us about the technology you use and the role artificial intelligence plays?

We use AI for mainly 3 key purposes: (1) Facial Recognition and Liveness Test, (2) ID Authentication, and (3) Loan Risk Scoring.

Example on loan risk scoring, in a matter of seconds, our algorithm analyses nearly 10,000 characteristics from opt-in with permissioned smartphone metadata to find the most predictive behavioral patterns before converting them into credit scores. This enables us to understand the repayment behavior and credit-worthiness ofapplicants with greater accuracy.

What are some of the strategic partnerships you have undertaken?

Aside from a winning product proposition, our digital platform banking strategy has been one of our primary go-to- market drivers. To elaborate,we have partnered with GCash, the leading e-wallet in the Philippines. This enabled their customers to enjoy 4.0% savings interest rate per annum offered directly on their mobile app where customers can sign up for a bank account in matter of minutes.

Furthermore, we have solidified our position as a partnership centric digital bank by strengthening and expanding our strategic partnership with GCash to further widen the reach of financial services, products, and solutions to all Filipinos, with the collaboration to power GCredit, a revolving credit facility available to GCash users. GCredit, which works like a flexible loan or credit card, gives GCash customers access to money that they can use to perform transactions and is easily available on the GCash app.Any GCash user with an eligible GScore may apply for the GCredit revolving loan.

To further build on our digital platform banking strategy, we recently entered into a partnership with another leading payment provider in the country and leader in the bills payment collection industry, we will extend credit facility to their customers.

With the vision of changing the Philippine banking landscape and providing financial services to more Filipinos by being present where the customer interacts daily on the mobile device. We are set to introduce more innovative and exciting products coupled with market-breaking e-commerce partnerships business model.

Online security is a major concern for customers. How does CIMB help ensure a secure environment for account holders?

The CIMB Bank PH app not only offers an intuitive and easy-to-use interface, but it also takes the safety and security of its customers’ funds and information seriously. Alongside a series of security measures that help keep customers’ accounts secure, the app also comes with layers of security that protect all transactions from fraud and identity theft such as:

MPIN: The MPIN, or Mobile PIN, is a 6-digit personal passcode that is used to authenticate all in-app transactions. More than just security, customers do not have to wait for a temporary pin for an important transaction.

Biometric Login: Aside from the usual alphanumeric password, users can now login to the app instantly via fingerprint identification or facial recognition, depending on the user’s phone capability.

Card Security: CIMB users are given full control over their debit card. All settings can be managed by users right from the app like adjusting cash withdrawals, spending limits and restrictions on transactions made locally, or online.Users can also easily reset their debit card PIN, and freeze or unfreeze the card to prevent any unauthorized access if it is misplaced.

Smart Pairing: The CIMB Bank PH app only allows to pair one account to one smartphone at a time to ensure that only one user is tagged to one device and account always. In order to change a device type, the user would have to go through another layer of security by keying in a unique code sent to their personal email.

Online Fraud Detection Platform: CIMB PH deploys the highest world-class security standards and advanced fraud solutions that provide profile normative customer behavior. We use real-time transaction monitoring and analytics model to detect behavior anomalies indicative of fraud. This helps ensure that every single transaction is first evaluated in real time before they are processed.

How has the bank performed to date?

The bank has already exceeded over 600% growth in deposits, following a reported 400% surge in average balances per customer in the 3rd quarter, and 160% in the 2nd quarter. The significant increase in average deposits allowed CIMB PH to surpass its 2020 deposit goals as momentum for customer acquisition continues to be strong and robust throughout the pandemic period, proving this model is what consumers are looking for also especially during this new normal that we are all going through.

With this upward trajectory, CIMB expects to surpass its initial target and is now expected to exceed 3 million registered users very soon.

How has the bank adapted to the current pandemic?

We launched a financial assistance program for COVID-19 patients last March, which allowed for CIMB account holders who tested positive for the corona virus to avail of P10,000 worth of financial support to pay for their medical expenses. Also, throughout the local community quarantine, we launched other initiatives to support customers’adjustment to the effects of the pandemic; So far, we helped more than 6,000 families and 73,000 individuals, with donations amounting to P1,000,000 through our efforts with Rise Against Hunger Philippines, UP Medical Association, and GCash.

More than our CSRs, we focused our financial literacy posts on encouraging people to save and build an emergency fund. We also offered 0% interest loan and we partnered with World Remit to offer zero remittance fees.

What are your future plans for development?

We want to build our platform in order to integrate with more partners and expand our products and services to more Filipinos. We want to be the #1 savings bank for all young Filipinos and enable them to open their first CIMB savings account.