Spotlight: Philippines Fintech and Healthtech

Spotlight: Philippines Fintech and Healthtech


A brief introduction: From time to time, Dymon Asia Ventures creates detailed primers summarizing our research into sectors of interest that we share with our portfolio companies and Limited Partners. These Sector Insights posts are a summary (or a periodic update) of our findings.



  • This month we’re spotlighting the Philippines start-up landscape, which we think may be at a breakout point with high-quality founders and companies well-poised to make a splash
  • Local corporates are investing heavily in technology and digitization, driving virtuous cycles of innovation and start-up-corporate partnerships
  • Within fintech, credit and payments are receiving the most investor interest
  • Fintech-adjacent SaaS may be a good way to gain exposure to the market without taking on credit risk
  • The historical popularity of networks like pawnshops, money remittance players and sari-sari stores provides important physical distribution channels for fintech-led products
  • Enormous infrastructure gaps remain in healthcare, with “Uber for healthcare” and telemedicine start-ups springing up to address excess demand


Attractive Entry Point. The Philippines as a startup market has been operating under the radar for the last few years. But a new crop of high quality founders and startups with regional ambitions are emerging in DAV’s sectors of focus. In a few years, investors may look back on the next 12 months as an attractive entry point into the market, when companies that were on the verge of breaking out were still priced at reasonable valuations. DAV invested in Brankas (open banking API platform; cofounded by Todd Schweitzer and Ken Shaw) this year, and a second investment in a leading SaaS platform in the Philippines will be announced shortly. Several of our portfolio companies in fund I are actively working on PHP market entry.


Local corporates are innovating. The major conglomerates are investing heavily in technology and digitization. Interest in establishing corporate innovation arms, launching tech / startup partnerships, and investing in early stage companies, is rising fast (for example, Union Bank launched fintech unit UBX this year, Kickstart expanded its VC business to all of the Ayala group companies, and Globe launched 917 ventures). This bodes well for startups that seek partnerships with established banks, insurers, and other incumbent players in the Philippines. It also brings more diversity to the sources of capital available for local startups that seek funding.


Within fintech, payments and credit are the first to attract investor interest. The local ecommerce market is $5bn and growing, but card penetration hovers in the low-20%s and cash is still the dominant medium of exchange. Attention to the payments sector is rising with the sale of to GoJek for $72 million this year, and with Paymongo recently becoming the country’s first startup accepted into Y Combinator. The launch of the Instapay service should drive up penetration of digital P2P transfers. Hopefully a unified digital ID will follow in the coming years. Following the evolution of other fintech markets, the most common types of payments startups today in the Philippines are still wallets or payment gateways that collect cash, aggregate and send onwards. But the holy grail for online commerce remains integrated one-click bank account checkouts – this is where players like Brankas have the potential to dramatically change the market.


The major conglomerates are investing heavily in technology and digitization. Interest in establishing corporate innovation arms, launching tech / startup partnerships, and investing in early stage companies, is rising fast.

In credit, companies are mostly concentrated around products like consumer unsecured loans, payday lending, and cash loans, with players like AsiaKredit, and Cashalo. This is in part because of the large unaddressed demand – more than 80% of the Filipino workforce live paycheck to paycheck – and attractive interest rates (60-120% APRs). But regulatory risk remains a concern, KYC is difficult (the country currently operates on at least 10 (!) different forms of primary ID (but is in the midst of rolling out the Philippine Identification System ID, a national ID system, with a target of 5% enrolment by the end of 2019 and full population coverage by 2025) and customer tracking is a challenge as mobile SIMs are easy to acquire and discard. On the consumer side, originators compete heavily for origination flow. Collections practices are typically unorganized and physical – an opportunity for a digital collections provider like AsiaCollect. There are also a number of startups tackling other credit verticals, such as checkout financing (Tendopay), and salary loan players who work directly with corporate HR departments to lend to employees (, Uploan).


Fintech-adjacent SaaS may be a good way to gain exposure to the credit market, without taking on credit risk. These platforms serve as an attractive access point (and get paid for generating leads) for fintechs and other credit providers, while earning SaaS-like revenue in their main businesses. SaaS players like Sprout Solutions and Salarium help HR departments to automate manual HR and payroll processes, but also act as lead generators and data acquisition funnels for salary loan providers. Startups like Juantax and Taxumo help freelancers and small business to automate tax filing, but that data also provides valuable insights to determine a company’s risk profile and creditworthiness.


The historical popularity of distribution networks such as pawnshops, moneychangers / remittance outlets and sari-sari stores helps fuel important fintech partnerships. They serve as widely ubiquitous cash-in / cash-out points for payment gateways like Dragonpay and checkout financing providers like Tendopay. Players looking for additional revenue streams can consider offering point-of-sale insurance and other financial products in partnership with insurtechs like Symbo.


In healthcare, traditional players are investing into real-estate based plays (clinics, hospitals) rather than in technology. An enormous infrastructure gap remains, and the market is dominated by HMOs which are inefficient but hard to change. The most common digital health startups are “Uber for healthcare” and telemedicine-style business models that address the under-penetration of healthcare clinics, such as Medgrocer (e-pharmacy and corporate healthcare solutions provider), Aide (at-home doctor visits and lab tests) and Zennya (at-home physical therapists and nursing care). Other notable players include companies solving supply chain inefficiencies (MClinica, B2B procurement for pharmacies) and electronic medical records (Medcheck).


Eight of the ten tech unicorns that Southeast Asia has produced so far originate from either Singapore or Indonesia. But the startup boom is going regional, and the Philippines is a market to watch.


*The opinions expressed in this publication belong solely to the author (Jennifer Ho) in her personal capacity, and do not in any way represent those of individuals, institutions or organisations that Dymon Asia may or may not be associated with in a professional or personal capacity

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