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How digital financial solutions help businesses grow in the “new normal”

The COVID-19 situation has pushed the world into a “new normal” where we are compelled to stay home and realign our priorities. The restrictions on mobility and activity have made a huge impact on businesses, especially those that rely on foot traffic. Agile entrepreneurs, however, have found tech-driven ways to sustain and even grow their businesses despite the challenges.

The rise of hyperlocal entrepreneurs

Before the pandemic, shopping usually meant going to a mall where you can visit the grocery for household essentials and drop by retail shops for clothes and other items.

Community lockdowns had people turning to online shopping for their needs. Many large brands already had an online store and delivery systems, but the surge in demand also caught their existing capabilities by surprise, resulting in delivery delays, and in some instances, people had to wait days or weeks for an available slot.

To fill the supply gap, entrepreneurial individuals who suddenly found themselves with time to spare at home started churning out home-baked bread and desserts, home-cooked meals, or sourcing fresh produce, seafood, and meats to be sold within their community and nearby areas. The items are posted in the community’s social media or chat groups where would-be buyers can browse through the items for sale and inquire directly with the sellers.

The proximity of the buyers and sellers means that the goods can be delivered immediately to the buyers’ homes. The trust among neighbors made it easier to pay through online fund transfers or cash-on-delivery (COD). If you have ordered goods being sold online within your community, then you have supported a hyperlocal entrepreneur.

Hyperlocal is about residents buying and selling products within their immediate communities. It is low-capital entrepreneurship that has altered the way people spend their time and money.

“Hyperlocal entrepreneurs are internet savvy and use technology to keep their businesses running. Instead of having customers come to them to purchase goods, they use digital platforms such as Facebook, Instagram, and Viber to market their goods and bring it to customers. It’s safe, efficient, and effective,” said Noel Santiago, Chief Digital Officer of the Bank of the Philippine Islands (BPI).
These platforms also allow the hyperlocal entrepreneurs to get fast feedback from their customers so they can improve their products, as well as anticipate demand and scale appropriately.

We know an entrepreneur who started by selling fresh vegetables on Facebook. After a few weeks, she has expanded to selling fresh meat and frozen goods in response to consumer demand. The business has since grown to the point where she had to hire a small social media team to handle the increasing number of orders.

Handling payments is one of the challenges as it requires a certain level of trust. Filipino buyers want to see and touch the product before they surrender their hard-earned cash, and often prefer COD payments. While COD gives a sense of security, it also comes with some inconveniences like having enough cash on hand or exact change. The pandemic has also added risks to touching cash as the coronavirus can stay on the surfaces of various objects.

This has led many businesses and customers to pay online using their banking apps and e-wallets like GCash and PayMaya. Aside from using it to pay for goods, it can also be used to pay for on-demand delivery services like Grab and Lalamove, which have been vital for consumers who can’t leave their homes. The digital “paper trail” also helps users keep track of their purchases.


The important role of banks

Banks play an important role in enabling and promoting digital financial solutions. Although there are e-wallets available, banks are still our main source of funds, especially for salaried employees.

BPI is one of the local banks that have been trying to help businesses by enhancing its cash management platform and other customer-centric functionalities and loading in-app e-wallets and website-integrated payment systems

This enhancement is part of BPI’s “phygital” strategy, to transform the customer experience of its clients using digital solutions while replicating the human or “physical” part of the experience.

“Providing our clients with a safe and excellent banking experience has always been our top priority. We believe digital services will help us achieve that, not just in the new normal, but in the near future as well,” said Santiago.

“However, that doesn’t mean that we’ll forego the human element of that experience. We will continue to provide clients with the excellent customer service we’re known for through digital means but with the same level of satisfaction as if they’re experiencing it physically.”

One service that uses the phygital strategy is BizLink, BPI’s internet banking platform for larger business and corporate clients.
BizLink, which offers tech-based financial management solutions, is for enterprises with more complex operations and needs. It simplifies companies’ transactions by providing a wider scope of services—from account balance and transaction inquiries, funds transfers, and bills payments, to payroll uploading, government payments, and supplier payments.

“Companies that have their own app or website with an integrated payment system have certain advantages,” said John-C Syquia, BPI Corporate Banking Head. “These enterprises are experiencing increased activity on their digital platforms during these times when everyone is encouraged to stay at home and minimize contact with other people to reduce the risk of exposure to the virus.”

“In the new normal, businesses will still have their transactions in the branches. However, we want to offer our clients the flexibility of an omnichannel experience. We want them to be able to mix the use of our branches and digital solutions; for instance, by starting a transaction in a branch and finishing it off viaBizLink and vice-versa. We want to provide the same level of quality and convenience for them,” Syquia said.

He also encourages companies to embrace cloud-based solutions, automation, as well as data analytics in order to build scale into their operations.

“Companies now have the opportunity to replace their cash and check collection systems with a more digital process. Companies need solutions that would let them work remotely and still be able to process their payments and collections,” Syquia said.

The COVID-19 pandemic is causing huge problems for everyone — not just for regular consumers but for businesses as well. Fintech offers solutions that can help mitigate the impact of COVID-19. And for that to be effective, consumers, banks, hyperlocal entrepreneurs, big businesses, and corporations have to work together.

This article was written by Louie Diangson, Managing Editor of YugaTech. You can follow him at @John_Louie.

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