Innovation, market expansion seen for banking industry

Eugene Acevedo, president and chief executive officer of Rizal Commercial Banking Corp., said banks now see potentials in providing services for the growing middle class and small business. /Irene R. Sino Cruz

CEBU CITY, Philippines—Innovation and expanding markets is the way to go for the country’s banking industry.

Veteran banker Eugene Acevedo, who just assumed as president and chief executive officer of Rizal Commercial Banking Corp. (RCBC), explained during a media roundtable discussion on Friday afternoon, July 12, that banks have to change its market approach and use technology to attain continued growth.

Acevedo noted that a growing middle class and the emergence of micro, small and medium businesses would spur growth for the banking sector.

He noted that the country’s robust economy, which is expected to grow between six and seven percent, would benefit the expanding middle class and small businesses. “So, it’s good time to be a banker. This gives us opportunities to serve the growing middle class and the small businesses that grow together with the middle class,” he pointed out.

The World Bank has projected that the Philippine economy would grow by 6.4 percent in 2019, and 6.5 percent in 2020 and 2021.

In the past, Acevedo said, banks usually cater to big corporate clients but there have been changes in the way banks look at potential customers.

“You might have noticed that bankers have started going down the base of the pyramid,” he pointed out. “It makes our life as bankers meaningful rather than simply lending to big corporate clients.”

RCBC, for example, used to have big corporate accounts that comprise 60 percent of their business, Acevedo said. However, RCBC now targets a 50-50 sharing between corporate and middle class/small business.

The bank is taking on a hexagon approach with six customer segments including mass market and micro; affluent and SMEs; and corporate and high network clients, he explained.

Acevedo prepared a roadmap for RCBC’s growth which has renewed focus on its retail and SME business as well as implementing key organizational changes, redefined goals and rationalized processes.

He also noted that the emergence of digitization and the use of data analytics and artificial intelligence would have a major impact on banking operations.

Acevedo, a Department of Science and Technology (DOST) scholar who graduated magna cum laude with a BS Physics degree at the University of San Carlos, is a technology advocate. He is expected to lead the bank’s digital transformation.

On Friday, the bank launched Diskartech, a partnership with local government units, cooperatives and sari-sari store organizations, among others, Acevedo said.

Through Diskartech, RCBC aims to reach 65 million Filipinos by tapping sari-sari stores, for example, to provide agency banking services, including opening an account, withdrawal and deposit, he explained.

Acevedo said the bank would soon fast track  the processing of loans to small businesses through the use of data analytics./dcb