How RCBC’s digital transformation is scaling financial inclusion
Steering the wave of change has been a continuous theme in Lito Villanueva’s career. ‘Mr Fintech’, as he is called in the Philippines, has been appointed as the Executive Vice President and Chief Innovation and Inclusion Officer at Rizal Commercial Banking Corporation (RCBC). This comes on top of being the Chief Digital Transformation Advisor for the Yuchengco Group of Companies (YGC). Villanueva embraced this new challenge after almost 10 combined years in the PLDT Group.
Despite the change in company, Villanueva’s vision remains the same: continuous digital disruption. He elaborates: “If we accelerate our execution of human-centric financial services with a delightful customer experience, the possibilities are truly endless.”
Widely recognised as one of the leading fintech executives in Asia, Villanueva joined RCBC in May 2019, bringing 25 years’ experience in telecommunications, payments, financial technology, global banking, digital transformation, regulatory engagement and international development advisory. “This experience contributes towards how I innovate and implement,” he explains. “Similarly, my stints with global leaders such as Visa, the International Finance Corporation of the World Bank Group, Economist Intelligence Unit and more, spanning over 35 countries, have given me a strong understanding of different markets, disciplines, and cultures that prepared me well for the challenges that I had to face.”
On the local front, Villanueva succeeded in making waves in the industry as Voyager Innovations’ FINTQnologies Managing Director under the PLDT Group, where he created trailblazing engagements. Particularly noteworthy was the implementation of Lendr, the Philippines’ largest digital lending platform with loans disbursed in excess of US$1bnn in less than five years.
While Villanueva has many successes in his career to date, there remains one overarching driver behind how he has approached each of his roles: people. “I’ve been honoured with various notable monikers in and by the industry” he shares, “such as the Philippines’ leading inclusive digital finance accelerator, digital transformation champion, prime thought leader, and entrepreneurial game changer, to name a few. But my singular purpose and passion in championing all these initiatives, is to help uplift the lives of Filipinos. Technology is just a means to an end with the customer at the core.”
According to Villanueva, this transformation isn’t purely restricted to RCBC, but rather, is driven by YGC. Key to this journey, he says, is Group Chairperson, Helen Yuchengco Dee who well understands the potential threats that organisations such as RCBC face from digital disruption and the importance of embracing such a change. When approaching RCBC’s own digital transformation, Villanueva first focused on “how to address the three key barriers in carrying out digitalisation: cultural, procedural, and structural. With the support of the entire Group,” he adds, “we are enhancing our competitiveness through convergence for data-driven product offering across the Group and collaborate through open banking to drive exponential growth.”
Form a pure technology perspective, Villanueva believes that the introduction of those new digital solutions mentioned previously will greatly improve the experience that RCBC is able to provide its customers. His first priority, he explains, is the harmonising and optimising of the company’s existing banking products. “I have my digital transformation equation: 4Ps+3Vs = PDC,” he explains. “The four ‘Ps’ relate to people, process, platform, and product - it’s all about thriving in a human-centric digital culture and delivering an awesome customer experience. Understanding the process is critical to stay ahead of the development curve, and all of our platforms and enabling infrastructure must be agile.” The three ‘Vs’ relate to velocity, value, and volume. “Agility and speed in execution will give you the velocity; value is vital in delivering customer adoption and loyalty; while volume provides growth and scale,” says Villanueva. “The result of being successful in these areas is PDC: profit maximisation, data generation, and cost reduction.”
Villanueva’s passion for excelling in the field of customer engagement and experience, and working to help Filipinos achieve better financial lives, is evident. He firmly believes that RCBC’s digitalisation will bring more success in this area. “Acquiring customers is relatively straightforward, keeping them to use your product is another story,” he reflects. “Before deploying any new technology, it’s critical to understand exactly what the customer needs - any product has to evoke emotions, it has to make a connection and an impact to their lives.”
One example he cites is the shift in RCBCs mobile point-of-sale (mPOS) business and its rebrand to ATM Go!, which saw Villanueva pull out more than 1,000 mPOS devices that were idle and redeploy them to merchants that had high velocity transactions. This move led to year-on-year growth of 622% and 515% in transaction volume and transaction value respectively, and has seen additional 100 rural banks, microfinance, cooperatives and other merchants engage with the initiative.
This type of work has even greater importance within the context of the significant unbanked society in the Philippines. “Creating an executive position like mine is a manifestation of YGC and RCBC’s wider commitment and drive to contribute in the government’s push to scale inclusive growth through technology,” says Villanueva, adding that new technology will be key to serving these customers. “You cannot scale anything using legacy or traditional banking, or through the current branch network system. Banking, not banks, today is all about always-on engagement. In achieving this, building out an ecosystem with our strategic partners will make the work even more rewarding and exciting. It’s simply O2O, or offline to online and vice versa. In a developing country like the Philippines, you must strike a balance between bricks and clicks.”
As we usher in the new decade, 2020 is poised to be a milestone year in creating a robust and sustainable digital economy. It is certain that the Philippines is geared up to make the leap from a lower-middle income nation to an upper-middle income country in the near term. Rooted in an increasing urbanisation and a growing young population, the Philippines’ economy is in a strong standing in the ASEAN region.
The fact remains, however, that there is still a digital and financial divide in the region that needs to be bridged. “Filipinos are known to weather socio-economic trials creatively,” says Villanueva. “‘Diskarte’ is a Filipino slang for resilience, creativity, resourcefulness, and - in some instances - innovation, which of course redounds to surviving against all odds. Simply put, it is GRIT, the Filipino way.”
In scaling digitalisation with growing consumer adoption, RCBC is launching the Philippines’ first inclusion super app, known as DiskarTech - a fusion of grit and enabling technologies. “With DiskarTech, we will be empowering Filipinos by fuelling their financial aspirations,” Villanueva explains. “It aims to provide equal opportunities in the countryside, catering to the financial access deficient segment to be gainfully engaged in the country’s economic activities. Financial inclusion is, in fact, a journey in itself,” he stresses.
DiskarTech is a three-in-one inclusion super app that will unlock the huge potential of every Filipino. In the process, ‘I-preneurs’ will emerge as a growth hack and self-help enabler, allowing enterprising Filipinos to earn from offering DiskarTech sachet banking services. They will now be able to facilitate DiskarTech transactions for those who have no mobile phones, or those who do not have any data service. This is an inclusive intervention that cuts across segments.
Villanueva points out that: “With all things said, technology is not merely about convenient access. It has to be relevant to make it adaptable, scalable, and sustainable.”
The business, he states, is always evolving. However, he is confident that the strong leadership and clear strategic direction under the dynamic and digital-savvy RCBC President and CEO Eugene Acevedo mean that “2020 will be an exciting year for Filipino consumers as we drive towards accelerating inclusive digital finance.”