Senangdali, a subsidiary of Malaysian insurtech startup Senang.io, has partnered with Philippine fintech firm GoodTech, to offer loan protection insurance products tailored specifically for rural banks in the Philippines.
Underwritten by local insurance providers, this innovative product aims to transform financial security for over 57 million Filipinos, a significant 52% of the country’s population, a press release stated.
The Philippines is home to over 350 rural banks, serving as critical financial pillars in their local communities.
Recognising the unique needs of these institutions, Senangdali has created an insurance product that seamlessly integrates with the banks’ existing offerings. This initiative not only enhances the banks’ service portfolio but also strengthens the financial stability of their clients.
A strategic partnership
This initiative is a result of a strategic collaboration with GoodTech, facilitated by the Malaysia Digital Economy Corporation (MDEC) through the Digital Exports Division (DEX) Connex Philippines 2024 programme.
MDEC’s DEX designed the platform to expand the revenue footprint of Malaysian tech companies into regional and global markets.
Following the rollout of the loan protection insurance, the partnership plans to introduce a motor aggregator platform and personal accident insurance, further diversifying the range of services available to rural banks.
Jove Tapiador, cofounder of GoodTech, emphasised, “Protection for the everyday Filipino and their loved ones is paramount. Microinsurance is the fastest-growing segment of the market, and our alliance with Senangdali enables our commitment to protecting families through our rural bank partners.”
Key features of loan protection insurance
According to Senang CEO Sharian Raj, it offers customisation to fit each bank’s unique loan products, covering aspects like loan amount and tenure.
It also provides protection for death, personal accidents, and hospital income, with plans to include credit default coverage soon. The insurance covers a wide range of loan types, including personal, agricultural, and microfinance loans.
“What sets our product apart is the customisation and integration process tailored for each rural bank, ensuring that their specific needs and the needs of their customers are met with precision,” he said.
The claims process is simplified to make it easy for rural customers, with claims typically processed within seven working days and 10% of the claim amount transferred to bank or e-wallet accounts within 24 hours.
Plus, the premiums are affordable. “The premium starts as low as US$3, embedded as part of the loan instalment payment, so clients don’t have to pay extra,” said Sharian.
Looking ahead
While the initiative is ambitious, it is not without its challenges. These challenges include ensuring smooth Application Programming Interface (API) integration across diverse banking systems, providing adequate training to bank staff and customers, and navigating the regulatory landscape for full compliance.
However, Senangdali is confident that its robust support systems and partnerships with local institutions will help overcome these obstacles.
Senangdali’s long-term goals for this loan protection insurance programme in the Philippines are clear:
- Reach 1 million customers within the next 12 months.
- Expand product offerings such as introducing additional insurance products to address a broader range of needs.
- Enhance financial inclusion to ensure rural communities have access to comprehensive financial protection.
- Sustainable growth to foster economic stability and growth in rural areas through innovative financial solutions.
This innovative approach is expected to significantly enhance the accessibility and affordability of financial services in rural areas, fostering greater economic stability and growth within these communities.
With Senangdali and GoodTech at the helm, rural banking in the Philippines is set to experience a transformative shift, bringing greater financial security to millions.
Featured Image Credit: Senang
