Interview: Hikmet Ersek
As one of the largest recipients of foreign remittances, what role might the Philippines play in new technological concepts like digital money?
HIKMET ERSEK: The large and growing remittance market in the Philippines is inspiring a lot of innovation from industry players. The Filipino diaspora are known to keep in touch with their recipients back home via new technologies – smartphones are their primary tool to access the web, followed by laptops. This provides a robust platform and an accepting environment for new innovations. Like Turkey, the Philippines has a very young population – 35% are under 15. Filipinos spend an average of 6.2 hours a day online via desktop or laptop, and in 2013 they spent some $1.3bn online. In addition, the number of mobile phone subscribers in the Philippines has topped 100m, and more than 8m of them have signed up for a mobile money service. Clearly Filipinos are comfortable with new technology, opening the door to new innovations like the movement of money online and via mobile platforms.
As regional economic ties grow in Asian markets, how can the Philippines advance its capacity to play a bigger role in outsourcing?
ERSEK: The Philippines is well positioned to take advantage of the growing openness of the Asian region. It has a solid structure in place to administer placement of overseas workers. Pre-departure training programmes are required for outgoing skilled workers. The Philippine government also extends its outreach to foreign-based Filipinos through its embassies and consular offices around the world. The education system delivers skills including functional English literacy, which helps Filipinos become productive in their host countries and find better jobs abroad. The young population is also an advantage. By 2015, more than half of the population will be of working age. The Philippines has a huge talent base. I believe that very soon both governments and companies around the world that need skilled workers will be turning to the Philippines.
How can large payments companies aid global efforts against money laundering and fraud?
ERSEK: One of the most important things these companies can do is uphold the highest standards of integrity, which to me means investing in compliance. Compliance and consumer protection are not just departments or sets of rules to follow; they are at the heart of what it means to be a responsible company. At Western Union, we are strengthening our programmes, hiring more people and taking more measures in a global regulatory environment that is demanding, fast-changing and increasingly complex. The financial services industry must work harder than ever to protect the money transfer system from being misused and to educate customers about fraud and money laundering – not just because it is required, but because it is the right thing to do for business and for the millions of people around the globe who depend on us.
In what ways can technology help small and medium-sized enterprises (SMEs) in emerging markets meet the challenges of expanding abroad?
ERSEK: Technology can help SMEs in many ways. In more developed countries like the US, SMEs often import goods and thus need to make payments in several different currencies. They need access to a variety of tools to help them pay online, track their payments and manage foreign-exchange risk. SMEs in emerging countries are often on the receiving end of cross-border transactions. They need access to technology that allows them to receive payment in whatever currency they want, and also transparency in transactions so that they can be sure they receive the amount they are supposed to. Not just SMEs can benefit from these services; so can entities like NGOs – for example, Mercy Corps, which needs to get funds to rural areas after a disaster. Technology can help them do that – delivering funds in minutes from around the globe for payout in cash.
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