Felixberto U. Bustos, Jr., executive director of the AIM Gov.Jose B. Fernandez Jr. Center for Banking and Finance
(JBF Center), says that technological innovations will allow smaller banks to focus on a small market and remain profitable. Bustos, a professor at the Asian Institute of Management (AIM), made these observations during the fourth installment of the 3rd JBF Lecture Series themed "Responding to Uncertainty".With Bustos were Union Bank of the Philippines chairman and CEO Justo A. Ortiz, Accenture partner Judy Tan, and Bangko Sentral ng Pilipinas managing director Ricardo San Juan.
During the session, Prof. Bustos
prophecies on the innovation patterns in the banking industries of the ASEAN-4 comprised of Indonesia, Malaysia, Philippines and Thailand.He
said that the ASEAN-4 trends will follow that of the United States where high PC penetration rates give encouraging prospects for the future of Internet banking.High cost and lack of confidence in wireless transactions, on the other hand, would deter mobile banking from taking off. He
presented results of his
study which showed that while Internet banking is currently the most widely adopted innovation in the ASEAN-4, its prospects are probably not as good as that in the US because of low PC penetration rates, "cultural" barriers in using Western innovations, and geographical dispersion.
Smart cards, meanwhile, are expected to be more widely used, particularly in Malaysia, where the current generation has been acculturated to the use of the GIRO financial card since their school years.
Unionbank's Ortiz emphasized the need to identify and study the market segment to which the technology is directed, and the internal mindset revolution required to complement the technology.