Sending money anywhere in the Philippines is now a lot easier thanks to the various money remittance centers like Palawan Express, Cebuana Lhuillier, Western Union and LBC. However, sending at least P1,000 can set you back by at last P20.
The full implementation and commercialization of the blockchain platform for rural banks is expected not only to reduce money remittance fees but make the whole process faster and more efficient.
“The blockchain initiative aims to provide a real-time, cost-effective and secure retail payment system in the blockchain,” UnionBank Chairman Justo Ortiz said.
Ortiz, who also chairs the Blockchain Association of the Philippines, said they might have finally cracked the hole of financial inclusivity with the project which aims to bring the over 30 million unbanked Filipinos to the financial system.
UnionBank Fintech Business Group head Arvie de Vera said the cost of sending money which used to be from P50 to P150 will be reduced to only P1.
Sending money through the bank used to require up to 26 steps following manual recon and verification compared to the only five steps following automatic recon and verification using the Blockchain technology.
Processing time is also reduced from five days to only five minutes, utilizing five departments to only one department now and from five persons involved in the process to only one to two persons.
Through UnionBank, rural banks now have access to the main banking network which allows them to perform important banking functions that universal banks can also do.
Ortiz said most rural banks in the country are not members of the Philippine Clearing House and the SWIFT Network. These banks lack Information Technology systems so the processes are very manual and paper-based.
UnionBank eyes the use of the Blockchain technology to make the whole ecosystem more efficient. The technology will be piloted in the following rural banks: Cantilan Bank, PR Savings Bank, City Savings Bank, FairBank and Progressive Bank
