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DigiCoop launched to boost credit to unbanked Filipinos

CEBU, Philippines —  Information and insights company TransUnion announced its move to boost credit access to farmers, government employees, teachers, as well as unbanked Filipinos.

TransUnion has reached an agreement with 1 Cooperative Insurance System of the Philippines (1CISP) and its partner TraXion Tech Inc. to extend its solutions to cooperatives in underserved and underbanked areas in the country.

“Grassroots finance has been performing well during COVID-19 and we want to reinforce this position. Our partnership with TransUnion enables us to further enhance cooperative lending capabilities. With better insights, they won’t have to manually process every loan that comes, accelerating their decision-making when extending credit services,” said 1CISP President and CEO Roy Miclat.

Cooperative members of 1CISP will have access to richer data solutions, which will enable them to better service their community and prospective members and drive greater financial inclusion.

1CISP offers support to mostly underprivileged communities by providing their cooperatives with life and non-life insurance products and wider financial services. Its tech partner—TraXion Tech—is a systems integration company that specializes in transaction management systems.

Together, the two organizations launched and operate the DigiCoop website where cooperative members can apply for loans, insurance, and investments, pay bills and other financial commitments, and access the DigiCoop virtual marketplace, among other capabilities. The website provides a convenient online platform that supports financial inclusion in rural areas.

Under the partnership, TransUnion will provide 1CISP and its member-cooperatives a reliable credit scoring and reporting system integrated and ready to use within the DigiCoop platform. This finally gives cooperatives visibility on their members’ off-books credit behavior, enabling them to assess the creditworthiness of their existing borrowers and new applicants more efficiently and effectively and at a reduced cost.

It will help cooperatives better manage their portfolio and lend with greater confidence, empowering them to be more competitive and allowing them to grant more and bigger access to credit to their community.

There are approximately 3,000 cooperatives serving members such as farmers, government employees, and teachers nationwide that will benefit from the partnership.

TransUnion’s solutions, 1CISP member-cooperatives will be able to offer them more tailored products and services that are reflective of the member’s individual finances whilst offering a faster and more convenient loan application process.

“Technology plays a huge role in terms of providing services, and DigiCoop and our other initiatives have played an important part already during the pandemic. With the addition of TransUnion’s solutions, we can extend our reach and fulfill our responsibility of providing protection and risk mitigation to the communities and members we serve,” Miclat added.

Mainly catering to rural areas, cooperatives are crucial in sustaining the livelihoods of communities and empowering marginalized members by providing opportunities for economic and human capital development.

During the pandemic, most cooperatives under 1CISP grew 8-10 percent in membership as many consumers were pushed to seek financial support in coping with the economic impact of COVID-19 on their communities and household finances.

To address the sudden surge of members, 1CISP and TraXion Tech launched the DigiCoop platform to be able to reach and onboard cooperative members despite the social distancing protocols and continuously provide them access to credit and digital financial services during these difficult times.

“As a tech provider, one of the biggest pain points in serving the communities is the lack of infrastructure. Alongside 1CISP and TransUnion, we enable cooperatives to virtually roll out services that they were only able to provide traditionally. By integrating TransUnion’s services into the DigiCoop platform, cooperatives now have access to better insights and intelligence that will help them mitigate and weigh the risks that go along with providing their members the loan that they require. At the same time, members are able to boost their capability and expand their access to the different financial services provided by the cooperatives,” said TraXion Tech CEO Ann Cuisia.

As part of the data-sharing agreement, 1CISP will also contribute its cooperative data to TransUnion’s database and strengthen the insights it is able to provide. In the end, it will become a true bayanihan effort that empowers all stakeholders to work towards achieving countryside development and nation-building goals.

“This partnership is a great milestone because it enables us to reach more underserved consumers and be instrumental in giving them access to the financial services they need. We’re proud to work with organizations like 1CISP and TraXion Tech that share our vision of improving financial inclusion to ensure that no Filipino gets left behind. This is only the beginning. It will be an ever-evolving process as we onboard more cooperatives into TransUnion and customize our solutions to tackle their specific needs,” said TransUnion Philippines President and CEO Pia Arellano.