Digido study finds Filipino fintechs thriving with innovation and sustainability, attracting investors emphasizing ESG considerations.
According to a study by consumer finance provider Digido, global sustainability technology (sustech) companies are prime for investments as ESG considerations rise to the top of the agenda.
Innovation and sustainability are at the core of many Filipino fintechs, according to Digido study. As a result, investors that want to emphasize environmental, social, and governance (ESG) aspects will be driving them forward.
The consumer finance business made reference to Tracxn’s findings. According to the data, the sustech sector has drawn around $400 billion in investments, with the majority of growth taking place between 2014 and 2022. Approximately $8.8 billion of this $400 billion had been used to fund the fintech microfinance industry, which is essential to sustainable development. Nonetheless, 169 sustech businesses in the Philippines received investments totaling just $4 million. This suggests that there may be chances to invest more money.
Developing guidelines for incorporating ESG factors into the investment decision-making process is one way to help ESG-focused investments become the primary force behind fintech growth in the nation. Increasing investor knowledge and awareness of ESG investing is another one of them. For instance, through business training and information initiatives.
According to Digido, these actions will help advance ethical and sustainable investing methods in the Philippines. Through funding rounds, it doubles investments in this way. Businesses that include ESG into their operations should anticipate more support from customers and investors.
Furthermore, because they go beyond commercial interests, they can have a significant and concrete impact on the battle against climate change and the sustainable growth of the economy.
Philippines’ sustech industry’s growth
The sustech market in the Philippines is predicted to continue growing at a stable pace relative to its rivals in Southeast Asia.
In addition, Digido notes that as of 2022, there were 216 sutech firms in the Philippines, which makes up 10.1% of all enterprises in Southeast Asia and ranks joint fourth with Thailand, after Singapore, Indonesia, and Malaysia. For the foreseeable future, the proportion of Philippine sustech businesses in SEA will remain constant. It will fall in the range of 10% to 1%.
Additionally, it is projected that sustech enterprises in Southeast Asia will expand more quickly when comparing regional dynamics with worldwide trends.
