Challenging Traditional Financial Models To Provide Better Alternatives

Salim Dhanani, Chief Executive Officer and Co-Founder of BigPay recognises that access to financial services in Southeast Asia is uneven with higher value products such as loans or wealth management remain typically enabled only for the richest segments of the population. 

And he is committed to change that through BigPay.

Launched in 2018, BigPay has since become one of the largest e-money players in the country, Claiming to be one of the first “challenger bank” players, the platform now plans to expand their offering not only for individuals but also to new segments such as businesses. “It started with a debit account, but the ultimate goal is to offer more services and give everyone equal access.”

“There’s a rising number of “digitally native” people who use their smartphones every day for all kinds of services. Thanks to technology and data, we can do two fundamental things. 

“First, we operate at a lower cost margin. Second, we use our data to better understand the risk profiles of customers in a way that traditional financial institutions have not been able to,” Dhanani says. 

This combination enables BigPay to deploy digital products to segments of the population that banks do not serve and Dhanani is plans to do it in a sustainable way.

“We give customers alternatives to traditional financial services. We believe we have competitive advantages in terms of deployment speed, product construct and risk management by implementing a wide range of technologies across the business,” he says. 

The Challenger Bank Model 

“At the core of the challenger bank model is lower costs, more transparency and better technology. We are using next-gen tech stacks that enables us to do two things, deploying products faster and assessing risks better. 

“Digital banking is about improving unit economics in order to serve more people while keeping the business sustainable. We’ve done this via a digital-first approach that lets us engage directly with our customers and all they need is their phone,” he says. 

With no overheads of traditional financial institutions, the platform passes these savings onto their customers. Having said that, BigPay is adopting the idea of traditional bank branches in some ways and has partnered with 7-Eleven to allow cash deposits across the country. 

Accessibility for their customers does not just end there, the introduction of the BigPay card along with features allowing for international transfers and bill payments, the platform is enabling payments almost everywhere. 

Dhanani and his team are now actively working on bringing personal loans and investments onto the platform for their users. The insurance feature will soon be available.

“Personal loans and digital investing are two exciting areas where we can help our customers be more aware of the importance of savings and overall financial health. For the longest time, the barriers to entry were high, with lots of paperwork, high minimum investment amounts as well as sales charges and management fees. This is changing.” 

The New Normal

The pandemic has created an uncertainty that is not conducive to spending. While it has not entirely gone away, the new normal it ushered in is highly digital especially in financial services. Dhanani is optimistic this is an environment BigPay is able to thrive in. 

He says the pandemic has also accelerated their drive to deploy more digital financial products and it will prove key to driving economic growth in a post-pandemic world. 

“We want to create substitutes for products that people get from traditional financial services institutions, but in a more efficient and effective way,” he says. 

Regulators along with regional policies have helped the ecosystem to flourish. “It is changing in a way that enables companies like BigPay to responsibly roll out innovative solutions to consumers. What it comes down to is, again, striking a balance between managing risk while allowing fintechs to rapidly deploy innovative products in an increasingly evolving market,” Dhanani tells BusinessToday. 

Accommodating Behavioral Changes

With a lot of people turning to online spending for everyday needs, payment platforms across the ecosystem started experiencing surges in a wide variety of usages. BigPay is one of these platforms. 

Dhanani believes in his case it was because acceptable everywhere helped, along with the automated expense tracker really appealed to users given the uncertainty and wanting to keep a closer tab on spending. 

BigPay is expecting this behavioural change to continue, even in the post-Covid normal. The platform also saw an exponential increase in their international transfer product adoption due to global travel restrictions in place. 

The platform also saw a large number of new customers turning to BigPay to send money home, an entirely digital signup means the whole transfer process is done from anywhere and removes the need to visit physical branches. 

“Having said that, we anticipate travel will come back in a big way and with BigPay being fee-free, it’s another reason to use BigPay as the main financial product,” he says.

Dhanani is also aware of the increasing number e-wallet players with unique products built around different use cases. “One thing about BigPay is that we’re not discount led. While we understand the powerful appeal of an instant reward, we have built a base of users who see the value of our product and keep it “top of wallet”. 

“We want to give people access to fairer, cheaper, more efficient and more transparent financial services that will positively impact their financial health in the long run, This is what really sets us apart.”

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