UnionBank's UBX Philippines ties up with Ping An to build blockchain-enabled platform for MSMEs

It will cover various services such as multi-channel loan applications, credit assessment, and loan disbursements.

UBX Philippines, a fintech subsidiary of Union Bank of the Philippines, tied up with OneConnect Financial Technology, an associate company of China’s Ping An Group, to build what it claims the country’s first blockchain-enabled platform geared to target the banking needs of micro, small and medium enterprises (MSMEs).

According to an announcement, the digital platform will be operational by end-2019, and will be made available to a progressively larger community of MSMEs by 2020. Data from the Philippine Statistics Authority (PSA) show that 99.6% of all businesses in the Philippines are MSMEs and they contribute to almost 63% of total employment. However, SMEs get only 9.2% of loans and financing from the country’s major banks.

The financing platform is an end-to-end platform that utilises OneConnect’s facial recognition technology, micro-expression interviewing technology, and big data-enabled artificial intelligence.

The platform will cover various services, such as multi-channel loan applications, credit assessment, loan disbursement, and anti-fraud checking. It will also allow lenders to target a wider MSME population in the Philippines. These MSMEs can also use the platform’s advanced capabilities such as AI, big data, remote interview with micro-expression technology and anti- fraud engine.

Additionally, the digital platform will aid MSMEs for supply chain finance. Through OneConnect’s Blockchain-as-a-Service (BaaS) platform, important data including order and logistics information is encrypted whilst enabling critical functions such as paperless contracts, contract judgement, compliance verification and financing risk assessment. On this platform, e-payment undertakings (EPUs) are transferable, divisible and discountable, whilst being recorded on the blockchain to make it tamper-proof and traceable.

“We believe there is huge economic potential in the MSME sector and we have confidence in how our technology can help enterprising businesses leapfrog into better ways of doing business,” said Tan Bin Ru, CEO (Southeast Asia) of OneConnect Financial Technology.
UnionBank’s GlobalLinker connects more than 40,000 SMEs and offers exclusive deals and business management tips, aimed at helping SMEs grow and “tech up.”

“In the Philippines, 77% of our population is unbanked and we have a diverse geography that spans across over 7,000 islands. Digital financial solutions – such as the ones we are co-creating with OneConnect – will allow us to include more MSMEs in the financial system,” said John Januszczak, president & CEO of UBX.