The credit card arm of Rizal Commercial Banking Corp. (RCBC) is banking on big data analytics to drive its business despite the prevalence of the COVID-19 pandemic.
During the recently held TransUnion Philippines’ Big Data Summit, RCBC Bankard president and chief executive officer Arniel Vincent Ong said by using data analysis, the bank could grow its plastic money business and their spending in a more sustainable manner.
Ong said big data analytics helped the bank realize that “stopping lending [during a crisis] is not the answer”.
“The question is how to be more intelligent with it,” he said.
The approach the business takes is risk-based. The card issuer cut the portfolio into segments and identified areas for growth along with areas for risk mitigation.
“We identified which segments need more help and which segments are resilient, and execute our risk-based actions,” he added.
RCBC Bankard immediately focused on customers who are deeply impacted by the pandemic.
“With the aid of big data, we offered products that will help them navigate the crisis, and keep their credit records healthy, which in turn will drive consumption and help our portfolio as well,” the chief executive explained.
“For new accounts, the key is to be able to identify segments that are thriving during the pandemic. We need to use intelligence to find these customers,” he added.
Meanwhile, RCBC Bankard has observed a significant increase in transactions done digitally. From 80-percent manual and 20-percent digital before the pandemic, Ong said during the summit that specific credit card transactions such as purchase conversion to installments and card activation have “completely reversed”, with 80 percent being digital and 20 percent done manually.
“In some types of transaction like bills payments using credit cards, that is now 95 percent done digitally through the RCBC Online Banking app,” Ong said.
RCBC Bankard recently reported that its credit card issuances increased by 44 percent to 82,000 new cards from January to June, while card spending grew to P26.4 billion, 19 percent higher than in the same period last year.
The bank had also seen a sharp drop in portfolio delinquencies – now at 6% percent – given all the actions the bank has been taking to manage its portfolio risk better during the pandemic.