UnionDigital Bank, thedigital banking subsidiary of Union Bank of the Philippines, today announced that it has acquired 1.73-M customers, reached US$70-M in loan book size, andcollected US$ 50-M in deposits from its first four months of operations in the country. UnionDigital Bank has achieved double digit growth in digital loans to mass market communities through ecosystem partnerships powered by UnionBank.
“Since our launch, UnionDigital Bank has been focusing on serving the needs of the underserved communities within UnionBank by offering digital deposit and lending products to our ecosystem, and we will continue to support the needs of these customers with additional products overtime,” shared Arvie de Vera, co-founder, President, and CEO, UnionDigital Bank. “The series of milestones that we have been able to achieve is a testament to the strong execution power of the team, in accordance with our community-led business model.”
de Vera further credits this achievement to the Digital Bank’s “laser focus” on the fundamentals: prioritizing the balance sheet.
“As a bank we’re very clear: it’s notjust about having a cool app or millions of users who don’t generate revenue- it’s about a balance sheet. It’s about growing the loanbook because that’s where the revenues come from- it doesn’t come from payments, it doesn’t come from sign ups. Valuation is great, but it’s notprofitability.”
As a subsidiary of the Philippine’s largest techglomerate, UnionDigital Bank’s success in growing its loan book is due in part to its sophisticated use of available data of consumer behavior within the larger Aboitiz ecosystem to create tailor-fit loan products.
“If you’re lending within an ecosystem, you have an anchor community, and that’s arobust way to provide credit because you have more data. Rather than using payments data, which is really not a good proxy for someone’s capacity and willingness to pay. But if you have robust set of data with context on their financial behavior,then you can properly price the risk, because you have historical data on the customer, you know you can give him a customized interest rate. A one-size-fits-all pricing is an inappropriate lending business strategy and sub-optimal consumer experience.”
UnionDigital Bank’s mission to drive financial inclusion begins with improving access to credit to the underserved communities by capitalizing on technology and decades of alternative data from the UnionBank ecosystem to create robust credit models that fit the Philippines.
In yet another milestone, UnionDigital Bank onboarded its first corporate account customer, Philippine Digital Asset Exchange (PDAX), marking the commencement of accumulating corporate account openings at UnionDigital Bank. Following PDAX, UnionDigital Bank aims to expand its partnership base with other leading communities and corporates, following its commercial launch.
Starting with PDAX, UnionDigital Bank has been expanding its partnership base with other leading communities and corporations. UnionDigital Bank looks to provide a smooth customer experience for corporates to make payments, transfer money, and even more core banking services such as treasury services, empowering businesses to do more with their financial assets.
“Corporate partnerships are vital to helping us reach the communities who need it the most. They are integral to the cohesive network the bank seeks to build and I believe their involvement is critical to reaching a fully digital Philippines,” said de Vera. “With this in mind, the start we’ve had with PDAX joining us on our journey affirms my excitement to include more corporate partners. We look forward to collaborating with partners of the same caliber to maximize the difference we bring to the financial lives of fellow Filipinos.”
The PDAX corporate account partnership demonstrates how UnionDigital Bank is committed to being approachable to fintechs and regulated institutions by offering products relevant to them, their community, and partners.
“We are confident that UnionDigital Bank offers the banking solutions that digital natives, such as PDAX, need to continuously grow,” said Nichel Gaba, Founder & CEO, PDAX.
UnionDigital Bank dares to make bold strides that result in direct changes to how Filipinos interact with their finances digitally. A homegrown fintech expert, PDAX, being the digital bank’s first customer is a good start to kick things off, continuing our rally to support our higher purpose of Tech-ing Up Philippines.
The UnionDigital Bank app is now live for a limited set of customers. For now, the app is currently available by invitation only. Future updates on the launch will be available through the digital bank’s social media channels on LinkedIn, Twitter, and Facebook.