Mynt, the fintech startup owned by Globe Telecom, Ant Financial, and Ayala Corporation, takes the next big step in financial inclusion by making hassle-free loans available to every Filipino through its lending arm, Fuse, which primarily caters to the underserved and unbanked population in the country.
Fuse offers GCredit and GScore for lending and credit scoring, respectively. GCredit is a credit line attached to one’s GCash account with funds they can then use to buy groceries, medicine, or even school supplies in partner merchants via GCash scan to pay. The amount they can avail of is determined by GScore, the first trust score in the Philippines which checks the financial capacity of an individual to pay back a credit based on their GCash usage. GCash is a mobile money service of Mynt.
“We are committed to enable the aspirations of the financially-underserved. With Fuse, we aim to create and sustain opportunities for growth and stability for individuals and businesses alike through responsible and fintech-enabled lending,” said Anthony Thomas, president and chief executive officer of Mynt.
Fuse believes that with data-driven lending, they can create a sustainable and scalable credit product in the country.
GScore, Thomas said, addresses the difficulty of most Filipinos to access credit due to absence of formal documents that prove financial capacity. Instead, GScore provides a “trust score” that people can earn without too much barrier just by engaging in regular GCash transactions such as buying load, paying bills, purchasing goods and services, among other things.
At present, many Filipinos have no other recourse but to turn to informal or unlicensed money lenders usually called “five-six” since they extend loans without collateral or documentary requirements. In exchange, they charge the borrowers exorbitant interest rates of 20 percent or higher, thereby, leading to a debt trap where people find it hard to break out of a borrowing cycle just to stay afloat.
This situation could be avoided through GCredit. With GCredit, once a customer pays their credit balance, it replenishes instantly. This provides customers peace of mind so they can have access to funds whenever they have emergencies or life milestones. As added benefit, those who continue to use and pay their GCredit properly will be given higher GCredit limits.
GCredit is currently at its beta stage and will be available commercially within the year.