Digital banking has become the preferred solution for addressing the disparity in access to formal banking services in rural communities. As mobile-friendly banking solutions do not rely on physical infrastructure, they can be more easily accessed by those living in geographically dispersed places—something that is very much needed in the Philippines.

Today, close to 50% of the Filipino adult population does not have a bank account, which resulted in the country having the lowest banking penetration rate in Southeast Asia. This is further amplified in rural regions, where the unbanked greatly outnumber those with registered bank accounts.

Therefore, financial inclusion is high on the agenda of the Philippines government.

Widespread financial inclusion in the Philippines is in motion

The situation, however, is indeed improving. In early 2020, 4 million new bank accounts were opened under BSP Governor Benjamin Diokno’s pandemic relief program. But despite this progress, the key hurdle of digital banking adoption still remains: rural communities need time to adapt. Founding chairman of FinTech Alliance PH Angelito M. Villanueva cited behavioural barriers, rather than structural ones, as the main reason for hesitancy towards digital banking amongst Filipinos.

At the same time, banks need to work to win consumer trust, as consumers still prefer in-person financial services. Bernardi Susastyo, chief commercial officer of ADVANCE.AI, said, “digital banks in the Philippines will need to figure out innovative products and services that meet the needs and trends of Filipino consumers, and accommodate low internet penetration rates.”

At the same time, the fight to capture the affluent mass market amongst incumbent, digital, neo, and rural banks  continues to be prominent. For banks to maintain their edge, they need to find ways to cater to both the digital savvy and the unbanked. One simple and often overlooked way to do that is by incorporating familiar technologies with minimal friction, such as SMS.

SMS: A reliable and trusted banking channel for rural Philippines

During the feature phone era in the early 2000s, the Philippines was widely regarded as the “Text Capital of the World.” This catchphrase described Filipinos and their love for communication via SMS.

In 2009, the average Filipino sent out 15 times more text messages than the average American per month.

And today, SMS still remains a  stable communication channel for Filipinos, especially the agricultural community which represents more than 25% of the country’s workforce. In places not serviced well by internet connectivity, SMS messaging is a reliable means to not only contact friends and family, but also to receive time-sensitive notifications and alerts.

Using SMS, a known and familiar method of communication, to engage customers can also allay fears and hesitancy amongst new technology adopters. As SMS integration does not require new users to download unfamiliar apps or communication tools, banks can easily embed SMS in every banking touchpoint, from transaction alerts, to one-time-passwords, to promotional offers. This familiarity and frictionless accessibility, helps banks grow trust with their customers.

Layering on accessibility with voice calls

Accessibility in banking is about delivering financial services to people, regardless of their geographical location, literacy level, or the app downloaded in their mobile phones. And voice messages facilitate exactly that.

With the ability to deliver notifications (typically sent as text messages) as phone calls, voice messages work as an effective fallback when communicating important alerts. This text-to-speech technology also allows for one-time-passwords to be read out through an automated call that triggers when the user attempts to make a bank transaction. Aside from offering banking on-the-go, voice messaging makes it harder for hackers to infiltrate private data by leaving no digital trace.

Voice APIs are also in line with the Filipino government’s goal of making banking more accessible, as it provides an alternative channel through which the visually impaired and disabled can conduct secure bank transactions independently.

Answering customers’ needs by going omni-channel

Of course, any bank hoping to expand in the Philippines cannot ignore the population’s changing communication preferences. Tech-savvy Filipinos are growing in numbers, as internet users increased by 2.1 million from 2021 to 2022. In the realm of chat apps, Facebook Messenger undoubtedly reigns supreme with a usage rate of 98% amongst internet users, as well as a sizable percentage of users on Viber and WhatsApp.

These numbers, combined with the fact that rural banks typically have smaller operations teams, show that an omni-channel communications approach that spans SMS, voice calls, and chat apps can help maximise customer reach. Ultimately, this can also contribute to financial inclusion.

Part of an omni-channel communications strategy is choosing the right technology partner that makes the go-to-market process easy. 8x8 Connect, a cloud communications platform, offers a unified dashboard that can help banks keep pace with customers as they switch from SMS, to voice calls, to chat apps. The platform also supports seamless integration with most existing CRM systems, including Zendesk and Salesforce.

Financial inclusion with SMS, chat apps, and voice messaging together

Everyone deserves national or international financial services that allow them to participate in the modern economy with peace of mind. SMS banking makes it possible for rural populations to benefit from the same technological advancements that have enabled their urban counterparts to connect with businesses from their homes. Voice messaging helps banks level up on their accessibility game. And chat apps cater to the growing demand from tech savvy customers. When used together through 8x8 Connect, banks in the Philippines can reap the benefits of an omnichannel approach that maximises their audience reach, but also eases operational woes.

Choose a reliable omnichannel solution—start with 8x8 SMS APIs.