RCBC eyes DiskarTech as digital bank

Published December 14, 2020, 7:00 AM

by Lee C. Chipongian

Yuchengco-owned Rizal Commercial Banking Corp. (RCBC) will build up DiskarTech – the highest-rating mobile app in the country – as spin-off digital bank, according to its president and CEO, Eugene S. Acevedo.

              “What we are doing now is we are growing in-house digital capabilities while investing in a division (DiskarTech) which can potentially be spun off as a stand-alone digital bank,” said Acevedo.

              For now, the bank is studying the newly-released central bank rules for banks and non-banks applying for digital bank license.

              “We have not finalized that decision,” said Acevedo when asked if RCBC will apply for a separate digital bank license.

                RCBC aims to rebuild its banking brand along digital lines and to lead the digital banking sector. “We can position to be the preferred digital bank in the country. All this will require much more diligence on our part. (There’s) a long list but they have to be done.” said Acevedo in a virtual briefing, “Future-proofing 2021: YGC Businesses with a Vision.”

                Acevedo said DiskarTech is already the highest-rated mobile app in the country at “4.2-4.3” stars out of “5” because this app “has better features than that provided by the other banks.” To maintain this rating, DiskarTech features would have to remain superior compared with other banks, he added.

              “What we need to do is to commercialize it. We need to attract more customers. We need to do a better marketing job and we’re doing that exact thing for the last three to six months but it requires a significant effort,” he said.

              In the next two weeks, Acevedo said its mobile app will be enabled to send US dollars, do foreign exchange, invest in unit investment trust funds, open an account and monitor investments. “How many mobile apps can do that now? None,” he said.

              Acevedo further said that RCBC will also migrate services and products “as much as we can” to the mobile app. Aside from Diskartech, among its digital products include RCBC mobile and online banking, handheld ATM Go mobile POS terminals, etc.

              “The most important thing really, the way to win customers is by providing them the best possible customer experience. (To have) as little error as possible, no waiting time, anticipatory using data science and analytics … By the end of the day (RCBC) workers would have to practice a much higher level of customer empathy. We need to keep doing better.  We need to feel what the customers are feeling. (To) continue listening to customers,” said Acevedo.

             The bank introduced DiskarTech in July, four months into the country’s long lockdown period, which is still in place today but with less severe containment measures.

             The mobile app gathered over one million new users  just over month after its launch. The bank said it is the fastest-rising finance app in the market, even surpassing the app rankings of Google Play Store and App Store. With just one valid government ID, a DiskarTech new user can open a basic deposit account and be validated in minutes through its e-KYC (Know Your Customer).

                While focusing more on improving capabilities on data science and digital marketing to “sharpen” customer acquisition, Acevedo said the bank is currently rationalizing its services, branches and ATM networks. “We need to cut costs,” he said. 

              As of end-September, RCBC’s net income dropped 11.3 percent to P4 billion from P4.5 billion same period last year as its loan loss provisioning increased to P7.22 billion.

              This year, the bank has closed 66 of its traditional brick-and-mortar branches. The branch network is the most expensive part of its infrastructure and operating expenses.

“The branch network is getting less and less relevant but they continue to be useful for the higher value products,” he said. “Branch will be there but they will be much smaller.” As such, the bank has frozen its hiring and are “right-sizing” its worker population.

                During the enhanced community quarantine months of March to May, about 50 to 60 percent of branch transactions “just disappeared” and Acevedo does not think those lost numbers are coming back. ATM withdrawals and other transactions have been replaced by electronic payments. “Things are changing significantly and that’s where we’re going,” he said.

              Similar with most banks, the long lockdown period increased RCBC’s electronic channels’ business and its corporate clients’ use of online payments and clearing. The bank’s digital banking enrollment grew by 196 percent year-on-year as of end-September, while its send cash services and cardless ATM withrawals went up by 521 percent and 3,535 percent.

 
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