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September 28, 2022

RCBC provides credit to unbanked with data analytics

With the aid of data analytics, Rizal Commercial Banking Corp. (RCBC) headed by bankero Eugene Acevedo hopes to provide credit to the country’s unbanked population.

RCBC Credit Management Group head Bennett Santiago said in a webinar organized by Asian Bankers Association (ABA) and the Association of Credit Rating Agencies in Asia (ACRAA) that the Yuchengco-led banks wants to address the challenges in evaluating loans to the unbanked in order to accelerate financial inclusion.

“From a credit perspective, we are trying to find ways to make credit available to the unbanked, based on how they spend government subsidies,” Santiago said.

The bankero explained that the listed bank is looking to develop a scorecard to assess the risk profile of the unbanked, challenged with having no credit and banking history.

The score will be improved by utilizing external data such as personality, behavioral and public data, according to RCBC.

Furthermore, there will be push for financial literacy and discipline to improve credit eligibility.

According to RCBC, the listed bank saw the importance of data analytics during the COVID-19 pandemic.

“We needed to have a differentiated customer review. We couldn’t have a one size fit all type of monitoring. We should spend more time on high risk and low risk accounts, [and] this is where the possibility of digitization, automation, machine learning happens for credit risk management,” Santiago said.

“Understanding delinquency drivers, on a customer level, was made possible through the use of data science and analytics. It has also helped improve collection strategy during the pandemic and enabled the business to implement data-driven decisions to mitigate risk,” he further said.

In a related development, the Credit Card Information Corporation (CIC) has classified RCBC as an accessing entity (AE). CIC is the country’s public credit registry and repository of credit information.

As an AE, RCBC can access borrowers’ credit information either directly from the CIC or through any of its accredited bureaus, namely CIBI Information Inc., CRIF Philippines, and Transunion Information Solutions.

Thus Yuchengco-led universal bank can better assess its borrower’s credit history, and accelerate its loan approval process.

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