financial inclusion

(Source – MONIX)

AI and fintech to boost financial inclusion in Thailand

One of the biggest problems in the world is financial inclusion for the underbanked and unbanked community. While fintech is helping to solve this quickly, there are still about 1.7 billion unbanked people globally.

In Southeast Asia, about 70% of the population contributes to these figures with Vietnam, Indonesia, and the Philippines making a huge chunk of it. Interestingly in Thailand, up to 63% of the Thai adult population is either unbanked or underbanked as well. These include lower-income consumers or micro or small-medium businesses operating outside the banking system.

The Thai government is now working to ensure access to the banking system and financial services for 30+ million Thai people through the implementation of modern digital technologies. And fintech is becoming the best method to reach out to these folks and ensure they get the best financial access.

One company that is championing this is MONIX Co. The fintech brainchild of SCB X Group and China’s fintech unicorn Abakus Group, MONIX was just set up to bring about what other legacy institutions in Thailand haven’t been able to accomplish – financial inclusion at scale.

According to Arche Zhou, Product Director of MONIX, while Thailand has a large portion of people that do not have a bank account, these same people are actually also digitally-savvy and offer a lot of potential for take-up of our innovative financial products. Hence, MONIX decided to do the right thing by making lending easier and more accessible for them with the user-friendly FINNIX app.

The FINNIX mobile app, which is regulated by the Bank of Thailand, offers 24/7 micro-finance loans through a 100% digital process from loan application to approval and disbursement. Considered the top digital lending app on Google Play Store and Apple App Store in Thailand, Thai consumers who previously didn’t have a bank account before can easily apply for credit in under five minutes with simply their smartphone and an Internet connection. The FINNIX app has since disbursed over 10 billion Thai baht.

However, simplifying loan processing and disbursement is only one part of the solution. Many users still needed to be educated on financial inclusion, especially on how to use the app, especially when it came to keeping their funds and information secured.

To enhance this, MONIX partnered with Singapore-based AI firm ADVANCE.AI to power their electronic KYC (Know Your Customer) user journey. Steps included a quick selfie using the smartphone’s camera along with a scan of the Thai national ID card to authenticate the user’s identity. The entire process can be completed in under 60 seconds.

“Trust is very important in the fintech industry. For us, as a business, it’s important to know who we are dispensing money to and how we are going to get it back,” said Chalinee Boonsongsup (Poppy), Product Owner of MONIX, who added that the app’s NPL (non-performing loan) ratio is in the single digits.

“In this way, authentication is important, so we need to make sure we have the right tools to really know our customers. On the other hand, we need our customers to trust us with the information that they shared with us,” Poppy added.

We want our customers to know that they are in safe hands, especially since many of them have been excluded from the financial system. It’s important that they trust our product and company. ADVANCE.AI’s eKYC solution which makes use of cutting-edge artificial intelligence (AI) technology not only helps us abide by regulatory biometric requirements – it works for those underbanked people,” Arche added.

Mohammed Fouladi, Regional Head of Customer Value Proposition, of ADVANCE.AI commented, with advances in artificial intelligence, the traditional customer onboarding, compliance, and credit decisioning process can be entirely re-designed in a way that is simple, and convenient but secure for both the end consumer and the financial institution. Fouladi also highlighted that the urgent challenge for financial institutions (FIs) is to think and decide how AI can shape and modernize the customer’s post-pandemic banking experience.