In 2024, GCash, arguably the most successful fintech company in the Philippines, continued its impressive growth trajectory following a strong financial performance in 2023.
The company secured additional funding, formed numerous partnerships and expanded its reach overseas. It is now preparing for a landmark public listing.
These developments mark a period of substantial growth and transformation for GCash as the firm further enhance its market position both domestically and internationally.
GCash up for largest public listing in Philippine history
GCash is preparing for what could be the largest public listing in the country’s history. GCash’s parent company, Mynt, recently raised its valuation to US$5 billion after securing in August 2024 funding from Japan’s Mitsubishi UFJ Financial Group (MUFG) and the Ayala Corporation, one of the largest conglomerates in the Philippines.
Analysts suggest that if GCash were to go public in the Philippines, it could be the largest IPO in the country so far.
Ernest Cu, Chairman of MYNT as well as President and CEO of Globe Telecom said that while there is a preference to list on the Philippine Stock Exchange (PSE), the option of a dual listing is being explored to take advantage of the greater liquidity in the US market.
Globe Telecom owns a 34% stake in MYNT, the parent company of GCash. GCash is a key component of Globe Telecom’s strategy to diversify beyond its traditional telecommunications business and shift towards becoming a tech-focused enterprise.
MYNT plans to launch the IPO for GCash around 2025.
GCash considers Philippine digital banking license
Following its investment from MUFG, Martha Sazon, CEO of GCash, told the press in August 2024 that the company was considering applying for a digital banking license.
However, the decision is still under discussion, Sazon said, noting that the stringent regulatory requirements related to the license could limit its operations.
GCash executives have expressed concerns that acquiring a digital banking license might slow down their operations and affect their existing partnerships with online lenders or neobanks, such as UNO Digital Bank and CIMB Bank, which could view GCash as a competitor if it became a digital bank.
GCash currently operates under electronic money issuer and remittance agent licenses from the Bangko Sentral ng Pilipinas (BSP).
The BSP recently lifted a moratorium on new digital banking licenses, opening up four new slots starting next year. The move aims to boost the sector’s performance and its contribution to digital transformation and financial inclusion goals.
Currently, there are six digital banks operating in the country: Tonik Digital Bank; GoTyme Bank of the Gokongwei group and Singapore-based Tyme Group; Maya Bank of Voyager Innovations; Overseas Filipino Bank, a subsidiary of Land Bank of the Philippines; UNObank of DigibankASIA; and UnionDigital Bank of Union Bank of the Philippines. Only two of them have reached profitability.
Evolving into all-in-one financial app
GCash is aiming to evolve into a comprehensive financial app by expanding its offerings to include investments, insurance, and consumer loans. This expansion is being facilitated through partnerships with both local and international companies.
For instance, GCash is collaborating with Southeast Asian e-commerce platform Lazada to provide loans to micro, small, and midsize sellers on Lazada’s Philippine website, as well as with Pioneer and Oona to offer insurance products.
The company is also teaming up with international partners to enhance financial transactions for Filipinos both locally and abroad, including companies such as Meridian, an instant payments technology company based in New York City; E9pay, a South Korean broker; and Taptap Send, a remittance startup headquartered in England.
These collaborations allow GCash users to link their accounts with those in other countries, enhancing convenience for users, particularly the estimated 10 million Filipinos living abroad. The app’s ability to be used internationally, supported by partnerships with Alipay and Visa, further adds to its appeal, particularly among travelers.
These partnerships followed the news that GCash had received approval from the BSP to expand overseas, allowing Filipinos in 16 territories, including the US, Hong Kong and the United Arab Emirates (UAE), to use international mobile numbers to sign up for and use the GCash app. The service, now known as GCash Overseas, aims to address the financial needs of the global Filipino community, providing them with services including remittances, bill payments, mobile topup, and more.
GCash plans to double down on AI and expands product offering
At the recent GCash Futurecast in July, GCash introduced several new innovations to its platform, with a strong emphasis on leveraging artificial intelligence (AI) to improve customer experience and bolster security.
One of the key additions is Online PaySafe, a security feature aimed at making online transactions more secure. The feature directs customers to the GCash app during their payment process, using multi-factor authentication to enhance security and reduce the risk of account takeovers, payment scam links, and website spoofing. The company has also partnered with Chubb to launch introduce Send Money Protect, a service that insures transactions against potential scammers for up to 30 days for a small fee.
Further enhancing its AI-powered capabilities, GCash also introduced several new features, including GScore AI, which calculates users’ creditworthiness and loan eligibility based on their daily app usage; Hyper-Personalised Ads, an AI-driven ad-serving platform that tailors offers to users based on their shopping preferences; and GCoach AI, an in-app guide that educates users on financial matters such as spending, saving, and investing.
The company also upgraded Gigi, its help center chatbot powered by generative AI (genAI), which can now manage common queries, escalate more complex issues, conduct security checks, access past conversations, and connect users to live agents when necessary.
In addition, GCash launched two new payment innovations: Tap To Pay, which uses near field communication (NFC) technology to allow users to make payments by simply tapping their phone; and Watch Pay, a payment method developed in partnership with Huawei that enables payments via smartwatches by scanning a QR code on the user’s wrist.
Finally, in July 2024, GCash introduced PayPal’s stablecoin, PayPal USD (PYUSD), to the Philippine market. The move enables users and freelancers who use PayPal, to send PYUSD tokens with low transaction fees to GCrypto, the in-app feature of GCash powered by the Philippine Digital Asset Exchange (PDAX). Launched last year, GCrypto allows users to buy, sell and hold cryptocurrencies, including bitcoin, ether, and now, PYUSD.
Strong performances
These developments come on the back of strong performances in 2023 during which the company recorded significant growth and reported a profit of PHP 6.7 billion (around US$115 million).
GCash disbursed loans totaling PHP 118 billion (approximately US$2.11 billion) in 2023, more than double the amount in 2022 and over 3.9 million unique borrowers accessed these loans.
GCash also expanded its wealth management services, with 9.5 million users registered for GSave and 5.8 million users on its investment platform, GFunds. Additionally, GCash sold 16.3 million insurance policies and registered four million users for its GInsure service, indicating its broadening reach in financial services.
GCash claims it has been used by over 94 million Filipinos, accounting for 94% of the country’s fintech app users. The platform supports a network of six million merchants and 900 partners in GLife, its lifestyle feature. The GCash Visa card, introduced in October 2023, has already gained one million users, offering enhanced rates and payment convenience in over 200 countries and territories.
Featured image credit: edited from freepik
