Banco Popular Dominicano CEO Christopher Paniagua advocates innovation to develop an “orange economy.”
Global Finance: How is banking digitization helping promote growth?
Christopher Paniagua: The digitization of financial services facilitates inclusion, making it possible to reach segments of the population not served in terms of financial services. The arrival of these new customers increases the market and the competition between the banks to capture the new clients.
GF: How will your collaboration with Microsoft assist entrepreneurs and SMEs?
Paniagua: Thanks to this strategic agreement, which is unique in the Caribbean region, Banco Popular Dominicano will expand its consulting services and technological products for SMEs, with cloud storage solutions, collaborative work and computer equipment, among others.
Popular and Microsoft will design the integration of specific tools in the ideation and acceleration of entrepreneurial projects. We will deliver these benefits via Impulsa Popular, our SME product and service portfolio, as well as through Emprende Popular, an initiative to develop innovative ideas and turn them into valuable startups.
However, the agreement also will simplify and accelerate Popular’s internal digitization while developing our employees’ digital skills. It also will include workshops on innovation, security and technical support to create joint solutions between Popular and Microsoft.
GF: What are you doing to support other important domestic industries?
Paniagua: Banco Popular Dominicano is the historical leader in financing national tourism, providing almost half the volume of loans that Dominican banks grant to tourism in the Dominican Republic.
Banco Popular’s financial support for tourist activity is distributed among nearly 800 clients, including the main foreign hotel groups in the country, accompanied by other financial measures and development programs.
The bank’s tourism support goes back 25 years, when it was the first bank in the country to understand the importance of developing the tourism industry and created a business unit specialized in promoting and invigorating the sector. Since then, we have remained the leading financial institution in this vital business segment, managing an average portfolio representing around 15% of all the financing that Popular places on the market each year.
In the past seven years, Banco Popular has granted financing of more than $1.4 billion, including $716 million for construction and renovation of some 13,600 hotel rooms.
Meanwhile, regarding UNESCO’s “orange economy,” Banco Popular Dominicano published Dominicana creativa: Talento en la economía naranja to expose and strengthen cultural and creative industries, which add value to the national economy and contribute to sustainable development.
With the book and the multimedia platform that complements it, www.dominicanacreativa.com, Banco Popular promotes the development of cultural and creative industries that are vital sectors for the country’s economy, such as tourism.
We support creative entrepreneurs and SMEs by providing training, savings products, lines of credit and support to boost their growth and thus develop innovative and sustainable business opportunities.
Through an inter-institutional agreement with the Ministerio de Industria y Comercio and the university INTEC, we are contributing with initiatives to promote entrepreneurship, higher education, and the formalization of the creative sectors.
GF: How are you embedding sustainable strategies and helping customers shift to a more sustainable way of life?
Paniagua: To embed environmental, social and governance [ESG] criteria–we must consider that we coexist with an environment. If this environment is broken–so we will be.
In September 2019, Banco Popular Dominicano committed to the Principles of Responsible Banking of UNEP FI. A month later, we presented a green finance portfolio called Hazte ECO and were the first financial institution in the country to have this type of offering. Hazte ECO is a package of loans with preferential conditions to encourage clients to adopt sustainable and environmentally friendly lifestyles that contribute to reducing greenhouse gas emissions, and is a part of our sustainable vision and our model for responsible banking.
We continue to add innovative products to the portfolio, such as green leasing to finance the installation of solar panels and electric vehicles for companies and individuals. It is a financial lease contract with tax benefits, and we are the only financial entity in the country to offer this environmentally friendly line of credit.
Since the signing of the Principles for Responsible Banking, more than 815 million Dominican pesos [$14.7 million] have been granted just for financing electric and hybrid vehicles. In total, for all products of Hazte Eco, we currently manage a joint portfolio of more than 1.2 billion Dominican pesos [$22 million].