Talino Venture Studios, an award-winning global venture studio for sustainable innovation, and Chemonics International, a leading sustainable development firm, have launched and seed-funded Higala, the pioneer startup Inclusive Instant Payment System (IIPS) in the Philippines.
As an IIPS, Higala will serve as a financial superhighway that will connect thrift banks, rural banks, and microfinance institutions that are currently excluded from payment networks because of high switching and on-ramp costs.
Despite the presence of 400 rural banks in the Philippines, only a mere 18 are part of InstaPay. This highlights a significant challenge: the lack of interoperability among these banks. As a consequence, the full potential of financial inclusion remains largely untapped, depriving many Filipinos of the benefits that modern banking technologies can offer.
“Higala will help modernize our country’s digital financial infrastructures and enable the participation of financial institutions through our network. Our goal is to make banking more inclusive, especially to the underserved segments of the population that have limited access to traditional banking services,” Higala President and CEO Vice Catudio said.
Higala promotes inclusion by lowering the cost of real-time payments, which helps financial institutions to reasonably price their instant payments. It also aims to provide inclusive financial solutions to the underbanked as well as rapidly enable merchants to accept digital payments.
“Through Higala’s open payment platform and suite of solutions, we will enable new market players to aggressively develop and market innovative payment services to both consumers and merchants,” said Catudio.”This includes integrating solutions such as regulatory technologies like e-KYC and AML-TF monitoring, AI-based risk detection and management, banking microledgers, payment hub that will enable instant fund transfer across participating banks, and a global transaction gateway for remittance,” he adds.
Higala is also building a core instant payment technology that can accommodate financial institutions of all sizes and turn banks into digital banks through white label app services.
Sustainable development
“At Talino, we are committed to the sustainable execution of development that benefits all stakeholders, especially the unbanked,” said Talino CEO Winston Damarillo. “With Talino and Chemonics providing funding for Higala, we bring together the impact of venture investing and global good to expand the benefits of financial inclusion to segments that need them most.”
“We are excited to embark on a new journey with Higala, a testament to our commitment to innovation and financial inclusion in the Philippines and other dynamic markets across the globe. Drawing from three decades of impactful partnerships and success in the economic growth space in the Philippines, Higala embodies our vision for affordable, real-time transactions accessible to all Filipino communities,” said Chemonics President and CEO Jamey Butcher.
The first deployment of Mojaloop in Asia
Higala leverages the open payment platform of Mojaloop Foundation, a nonprofit dedicated to boosting financial inclusion through its open-source software called Mojaloop. With Mojaloop’s open payment framework, Higala facilitates seamless connectivity among various financial entities, including banks, institutions, payment gateways, merchants, and the central bank. This approach enhances affordability and accessibility in financial transactions.
“With the pioneering deployment of Mojaloop open source software in Asia through our collaboration with Talino’s Higala, the Mojaloop Foundation reaffirms its commitment to breaking down barriers and empowering communities through financial inclusion. Together, we’re not just revolutionizing payment systems; we’re unlocking opportunities, fostering resilience, and building a future where financial access knows no bounds,” said Mojaloop Foundation Executive Director Paula Hunter.
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