By Bernie Cahiles-Magkilat
The Philippines’ leading mobile wallet GCash has introduced a digital savings account that offers the biggest interest earnings in the country in partnership with CIMB, one of the largest investment banks in Asia.
Anthony Thomas, Chief Executive Officer of Mynt (Globe Fintech Innovations), which operates GCash, said that through GSave, which is accessible through the Save Money feature in the GCash app, unbanked Filipinos are given an opportunity to open a savings account with CIMB bank. The account will earn 3 percent interest rate per annum—the highest in the country, where regular savings accounts earn less than 1 percent.
The introduction of this mobile savings platform comes as the Bangko Sentral ng Pilipinas (BSP) celebrates Savings Consciousness Week on June 30-July 6, pursuant to Proclamation No. 380 issued by former president Fidel Ramos in 1994 as part of efforts to hasten capital formation through savings.
In its Circular Letter No. 2019-038, the BSP urged the banking industry to “continuously encourage the public to save in banking institutions and further raise awareness on the vital role of savings in the country’s economic development.”
Around 66 percent of Filipinos do not have bank accounts and 34 percent of municipalities do not have access to physical banks, mainly due to the high cost of delivering financial services in the traditional manner such as opening more bank branches, especially in remote areas.
“Meanwhile, more and more Filipinos are getting digitally connected through smartphones. We saw this as an opportunity to deliver access to financial services through a mobile platform, which is how we came up with GSave,” said Thomas.
GSave is a digital savings account by CIMB bank, which requires no initial deposit or maintaining balance. Opening a CIMB account can be done through GCash’s Save Money feature. Once users open an account, they can deposit and withdraw through GCash anytime, anywhere.
“The 3 percent interest rate is a big bonus. What we are really giving people is access to financial services that will help them build a better future for themselves and their loved-ones, no matter where they are. That is what financial inclusion is all about,” Thomas said.
Studies show that 42 percent of Filipinos use their savings accounts for emergencies, 31 percent for education, 29 percent for starting a business, and 23 percent for safekeeping. However, one in five Filipinos still think they do not need a savings account, and of those who do want to save with a bank, 18% said they did not have the necessary documents and 10 percent felt it was too expensive to open an account.
“With GSave, we try to address these barriers to banking and make saving not only easy but fun for people,” Thomas said.
CIMB is a leading universal bank headquartered in Kuala Lumpur, Malaysia. One of the largest Islamic banks in the world, CIMB is present in 16 countries and has been awarded Best Islamic Finance House in Asia 2018, Best Bank for SMEs in Malaysia 2018, and Best Private Bank in Malaysia 2018.