In 2022, The Fintech Times posed the question: ‘what sets a ‘fintech for good’ company apart from the rest?’. This year, we wanted to hear directly from global fintechs that align themselves with the ‘fintech for good’ ethos. Why do these companies perceive themselves as agents of positive change in the industry?
Raffy Montemayor, co-founder and business head in the Philippines of Salmon, reveals how the fintech company is on a mission to expand financial inclusion by making finance simpler, more intuitive and more accessible to more people.
Tell us about your company
I set up Salmon in the Philippines in July 2022 together with two other seasoned banking and fintech entrepreneurs with a goal of expanding financial inclusion in Southeast Asia by making financial products more accessible to a greater number of people.
The conditions for launching and successfully scaling modern financial services are just right in the Philippines, provided you have the banking and tech expertise to do it. And there is a truly pressing need to democratise financial services, which are currently only accessible to a small percentage of the population due to a combination of historic and structural issues.
The Philippines has one of the lowest GDP to lending ratios in Southeast Asia, and is home to just six million unique credit card holders out of a population of over 110 million people. While lending is scarce, demand for loans and other financial products is rising. GDP growth is forecasted to average six to seven per cent per year over the medium term in the Philippines, with GDP per capita growing about 55 per cent within the next eight years.
In November, we launched our first consumer lending product, and we hope to diversify our offering going forward as we strive to become the best credit-led bank in Southeast Asia.
Why do you think your company is a ‘fintech for good’?
We are building a profitable fintech company, while also fulfilling an important social mission. Simply put, we are using technology and our expertise in both banking and fintech to democratise access to financial products for the underbanked, enabling them to participate in the formal economy more fully.
The Philippine bankable population is expected to expand by 30 per cent to 85 million by 2030, and traditional banking services have so far been unable to keep pace with the spiking demand for financial services.
Starting with consumer lending, Salmon plans to further expand the types of financial products it offers, helping more people take charge of their financial well-being and become full-fledged participants in the national economy and even the wider region going forward.
How do you measure your impact?
We pay very close attention to what our customers tell us to ensure we are making an impact and to look for ways to further improve what Salmon does. A recent customer survey highlighted that for 76 per cent of our customers, Salmon financing was the first loan they have ever received from a financial institution. What’s more, 72 per cent of surveyed customers said that they used the loan for business or to make a personal purchase that helped them generate income.
These statistics highlight just how important it is to unlock financing for a greater number of people, which in effect provides them with an opportunity to build a better life.
Another statistic I’m especially proud of is that 92 per cent of our customers said that they would recommend Salmon to their friends and family. To me, this confirms that we are doing this the right way.
What more can be done to make finance more ethical, transparent and accessible?
Making financial products simple to understand and to use can go a long way for ensuring more ethical finance, and this is where technology can help. Salmon has recently launched an app to help our customers understand and manage their loans easily.
We also use company representatives across retail locations where we offer our financing to further explain point-of-sale loans to consumers. In addition, we rely on technology, including facial recognition, to reduce the risk of fraud to make lending more accessible to a greater number of people.
A dialogue between relevant stakeholders, including fintechs like Salmon, banks and regulators is also important. We must work together to boost financial literacy, so the general public is better versed about what financial tools are available to them and what responsibilities they carry contributes to improving the transparency and accessibility of financial products and services.