Lender Expects Online Platform User Growth – BusinessMirror
PHILIPPINA Cashtrout Lending Corp. (PCLC) expects the country’s economic growth, improved technological landscape and more digitally savvy people to double the user base of its Cashoyo, Mocasa and Pesomio online lending platforms.
“We see our target user base as of now at 113 million,” Mocasa COO Julien Chien told BusinessMirror on the sidelines of the company’s briefing in Makati last Wednesday. “But this number can constantly increase as the country’s economy grows and infrastructure develops. And since Filipinos spend most of their time on online apps, we try to use online channels.”
Note that the World Bank estimated the total population of the country at 113.9 million people. Chien said that since entering the Philippine market last January, their mobile app has been downloaded by more than one million Philippine users, of which 100,000 have received loans.
Seeing that lack of access to credit remains a problem in the country, “as evidenced by the low penetration rate of credit cards at about four percent today,” we are optimistic about the growth in demand for loans in the coming years, Chien added. “By the end of this quarter, we are trying to get 150,000 [credit users]. And by the end of the year we are looking for 300,000,” he said.
“Therefore, we are focusing on the underserved and unbanked population. We want to serve those who are not served by traditional banks,” PCLC CEO Robin Wong said at a briefing.
The PCLC documents state that the firm’s “buy now, pay later” service, or BNPL, provides borrowers with an initial line of credit ranging from 3,000 to 10,000 pesos. The firm added that their credit limit will be determined by their payment behavior using artificial intelligence. Borrowers are given 50 days to repay the loan. In addition, an interest rate of 3 to 9 percent will be charged each month. Chien admitted that this is “a bit higher than a traditional credit card” because their users’ default rate is slightly higher compared to the latter.
“Therefore, we also need to cover the costs with a slightly higher interest rate. But this is in line with the national limit of 15 percent of the monthly interest rate for credit companies set by Bangko Sentral ng Pilipinas,” he explained.
“But the interest we charge is way below the average [in out category]Wong said.
The PCLC said its Mocasa platform is accepted in more than a million QR code locations in the country. The executives added that, through payment partners, it is connected to hundreds of thousands of online and offline merchants.
According to them, the application is also applicable for use as a payment channel for services in the following areas: government agencies; healthcare; real estate; telecommunications; and transport. With this platform, the purchase of a mobile load is also possible. Note that neither PCLC nor Mocasa were found in the list of registered BSP payment system operators. (See https://www.bsp.gov.ph/PaymentAndSettlement/COR.pdf)
“Through the efforts made by the government here, we are seeing the continued natural growth of Mocasa in the Philippines,” Chien said.