Launching just within a year of receiving its banking license, Tonik Bank was able to deliver a truly digitized experience to its customers using Radar Payments by BPC, and garner $20 million retail deposits in its first month of operations.
-IBS Intelligence

Digital wallets and cashless transactions have gained increasingly traction among retail clients, thanks to changing customer expectations post the pandemic. This phenomenon has accelerated the rise of digital payments and the need for digital-first banking experiences.

At the same time, within the Philippines market, it was estimated that over 70% citizens were unbanked or underbanked in 2019, making it a potential market of $140 billion for retail deposits and $100 billion for unsecured consumer lending, an opportunity that Tonik bank wanted to address.

Founded in 2018, Philippines-based Tonik received its banking license in January 2020, becoming the first bank in South-East Asia to operate on a purely digital platform. As a digital bank, Tonik wanted to not only alleviate the financial inclusion challenge but also cater to the younger, digital-first generations like Millennials and Gen Zs.

In the Philippines, the standard practice is a community saving model known as the “paluwagan,” or a shared pot that can be accessed by family members or friends as and when required. Inspired by this practice, Tonik planned on digitising the banking experience and promoting frugality, allowing Filipinos to save and grow their money at the same time.

Founded in 1996, BPC links real life needs to smart digital solutions, helping customers in various industries ranging from banking, retail and mobility to build out meaningful ecosystems. It works closely with all types of financial institutions, ranging from tier one banks to midsize and smallfirms.

Tonik selected BPC along with its paytech company, Radar Payments for its payments processing needs, which was to be delivered through a Software as a Service (SaaS) model. Built using BPC’s SmartVista, an industry recognised payment solution, Radar Payments platform delivers a solution that is resilient and scalable, with high levels of performance and security.

Project and Implementation Overview

Tonik needed to make a critical decision whether building everything from scratch or rely on partners to support a short go-live roadmap. Tonik reviewed the market extensively and decided to build its front-end digital engagement layer in-house using an API open banking-based platform, while plugging in best-in-class partners, such as Radar Payments by BPC to augment its capabilities in key specialized areas.

Radar Payments services were delivered through a Software as a Service (SaaS) model and included payment switching, fraud management, and card lifecycle management powered by BPC’s SmartVista digital banking platform for the cloud including connections to a host of P2P and retail partners. This enabled Tonik to efficiently route transactions and provide a secure environment for its customers while gaining the speed to market and performance.

Tonik provides a great example of how fast neobanks can go to market in just a matter of months by using an agile approach. The bank was launched within a year of getting its license and with best-of-breed solutions it was able to focus on delivering a compelling offering and experience to its customer

Benefits Achieved

Tonik was the first bank in the Philippines to be certified PCI DSS compliant. The certification was possible through the efforts of Tonik together with the team at Radar Payments by BPC. Key highlights include:

• A truly digitized experience, which garnered $20 million retail deposits within the first month of operations.
• Simplified services to the customer and innovation through use of smart technology.
• Reduced time to market.
• Achievement of cost control by adopting a hosted service reducing the need for high upfront investments in infrastructure.

Conclusion

The banking sector in the Philippines was ripe for digital disruption. With BPC, Tonik bank was able to achieve its goal of digitising the banking experience and adding a strong asset to its ecosystem by delivering banking and payments the way customers have come to expect – fast, affordable, efficient, and secure.

Such implementations also lead to a new way of thinking about financial products and processes, which will become quicker, easier, and more secure for the customer. With banking shifting to digital platforms, it becomes more accessible, especially for those who were left behind by the traditional banking industry, helping the overall cause of financial inclusion in the country.

Quick Facts

Supplier: BPC
Headquarters: Switzerland
Founded: 1996
Client: Tonik Bank
Solution: Radar Payments; SmartVista on the Cloud
Timeline: Go-live in March 2021