Philippines

Top 4 Emerging Fintechs from the Philippines to Watch in 2024

The Philippines is witnessing a rise of its fintech industry, a growth that’s been driven by a growing digital-savvy population, the cohesive efforts of both governmental and private entities, and booming usage of digital financial services — to get a sense of its future it’s helping to look at some of the top emerging fintechs from the region and it’s overall landscape.

A new report produced by Fintech News Philippines in collaboration with Fintech Alliance.ph and supported by Alibaba Cloud delves into this growth, highlighting regulatory efforts by the central bank and policymakers to foster a digital financial ecosystem, the country’s unique position as a developing nation with a significant unbanked population, and how new digital entrants have been enabled to tap into these opportunities to grow and expand.

These efforts, coupled with a push from the government to improve financial inclusion, have led to soaring usage of digital payments and wallets, and the subsequent improvement of financial access.

In 2021, financial account ownership rose to 56% of the Filipino adult population, representing a significant increase from the 29% recorded in 2019. This growth was largely driven by the uptake of e-money accounts, which climbed to 36% in 2021, up from a mere 8% in 2019.

As the use of fintech solutions soars in the Philippines, we look today at some of the country’s up-and-coming fintech champions.

For this list, we’ve selected four fintech startups that have witnessed significant growth over the past year and which are poised for strong growth in 2024. We’ve focused on companies that already secured sizable rounds of funding, which have launched their main product and have already developed a user base. They are now looking to strengthen and expand their offering, grow their teams, or launch overseas.

Here are the top 4 emerging fintechs from the Philippines that we think is worth keeping an eye on

Netbank

Founded in 2019 and headquartered in Manila, Netbank is a fully regulated Filipino bank, operating on a white-labelled basis. The company claims to be be the first banking-as-a-service (BaaS) platform of its kind in Southeast Asia, offering businesses a range of services that simplify opening accounts, managing payments, the handling of small and medium-sized enterprise (SME) loans, card issuance and mobile banking. Netbank also operates branch operations in its home region of Romblon.

Using Netbank, Filipino fintech companies, financial institutions, but also non-banking players can focus on their clients and their growth, and provide convenient and seamless digital financial services to their clients.

Netbank says it turned profitable in March 2023, claiming that its deposits have grown by 14x, loans by 5.5x, and assets by 16x within the prior 12 months. It says it currently has around 20 different financial solutions in the pipeline.

In May, the company raised an undisclosed amount in a Series A funding round led by Beenext, with Kaya Founders and Oak Drive Ventures participating. Gus Poston, co-founder of Netbank, said the company would use the proceeds to expand its lending products to “more segments of the Filipino new economy”. In the long term, it also wants to expand outside the Philippines.

Salmon (Fintech Holdings)

Founded in 2022 and headquartered in Manila, Fintech Holdings, doing business as Salmon, operates a platform that offers customers access to financial products from partners registered with the Securities and Exchange Commission (SEC) in the Philippines. The company’s goal is to provide a new level of service and financial inclusion through a combination of technology, product design, security, data analytics and a deep focus on customer care.

Salmon’s products and services include a point-of-sale (POS) lending service that allows Filipinos to defer payment and spread the cost of their purchases over several monthly installments, as well as Salmon Credit, a credit line product with built-in QR Ph payment options that grants customers easy and flexible access to credit for their daily spending needs without requiring a separate loan application for each purchase.

Starting with POS lending, Salmon intends to expand its range of financial services to cover all the daily needs of the client in the Philippines and in the future across Southeast Asia.

Salmon claims that its business has expanded rapidly since its inception and says it was able to launch its first credit product only four months after its founding and deliver new product launches every three months since then.

The company secured a US$20 million debt facility in July 2023 from US emerging-markets specialist investment firm Argentem Creek Partners. The company said it would use the proceeds to further scale its lending operations across the Philippines, expand its loan book by leveraging its existing POS and cash loan lending, and launch new products in the second half of 2023.

RuralNet

Founded in 2019 and headquartered in Cebu City, RuralNet is an insurtech company providing a digital distribution platform designed for financial institutions. The company’s platform offers services like customer enrollment, online policy management, online claims handling, plug-and-play insurance application programming interface (API) and insurance programs based on customers’ needs.

RuralNet’s cutting-edge digital middleware platform helps partner financial institutions deliver in-person insurance better and faster, starting from enrollment all the way to processing claims. It uses cutting-edge digital technology in its backend operations to help financial institutions deliver quicker in-person services.

The company claims that it has already partnered with 25 financial institutions to help deliver micro-insurance to about two million Filipinos.

RuralNet raised a US$2.15 million in a Seed funding round in October 2023 anchored by venture capital (VC) investor Kickstart Ventures, a corporate venture capital (CVC) firm wholly-owned by Globe Telecom, according to regulatory filings accessed by DealStreetAsia. The funding round also drew participation from other investors including Gentree, Foxmont and Kaya Founders.

With the backing of Kickstart Ventures, RuralNet is now poised for expansion. The company is looking to broaden CashKo, its brokerage service that connects various financial and retail partner institutions nationwide to extend insurance solutions to Filipinos, especially SMEs. With its expansion of CashKo, RuralNet hopes to cover 200,000 to 300,000 employees within five years.

Advance Tech Lending

Founded in 2018 and headquartered in Manila, Advance Tech Lending claims it is the first salary on-demand provider in the Philippines, providing short-term, multipurpose salary advances to eligible employees.

The company issues instant salary advances with minimal interest. It offers eligible borrowers the flexibility to advance up to 50% of their monthly basic salary, at any time. The interest rate starts at 3.5% and is payable 30 days from the date of disbursement.

Advance Tech Lending handles all the administrative matters, from pre-approvals to onboarding and repayments, and turns a portion of an employee’s salary into a credit line. The application process is all online and takes seconds, and disbursement is instant upon approval.

Advance Tech Lending has partnered with over 200 companies to provide on-demand financial services to their employees, including major industry players like Sitel Philippines, Inspiro, Cebuana Lhuillier, and ePerformax.

The startup secured in March 2023 a US$16 million in a pre-Series A funding led by Do Ventures from Vietnam and Lendable, a technology-enabled investment and debt provider to fintech companies in emerging markets. Along with the fresh funding, it announced that it has expanded into Vietnam with the acquisition of BravoHr, a Vietnam-based platform that provides digital solutions for employee engagement, benefits, and rewards. BravoHr’s key clients include some of the biggest global brands like McDonalds, L’Oreal, and AstraZeneca.

With this latest raise and strategic acquisition, Advance Tech Lending said it will introduce more innovative financial products and offer its services to more partners in the Philippines and Vietnam.