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Tonik: Transforming banking with an API ecosystem and data-backed personalization powered by Google Cloud

About Tonik

Launched in March 2021, Tonik is the first purely digital neobank in the Philippines, and one of the very few neobanks globally that is operating on the basis of its own full digital bank license granted by the Bangko Sentral ng Pilipinas (BSP). Its mission is to make banking accessible to millions of customers on a secure digital platform that’s available anytime, anywhere. The neobank provides flexible and inclusive financial services including industry-leading deposit interest rates of up to 6% per annum, and unique saving features such Solo and Group Stash products. Through an ecosystem of partners, Tonik provides financial services such as savings, loans, and much more.

Location: Philippines

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Tonik, the Philippines’ first neobank, adopts an API-first approach on Apigee API Management Platform to offer innovative digital banking services to its customers and unlock business opportunities with ecosystem partners.

Google Cloud results

  • Customer centricity across various transactions
  • Lower customer acquisition costs as well as financial inclusion
  • Improves financial access for customers in rural Philippines through API integration with ecosystem partners
  • Creates a developer platform to accelerate product development
  • Strengthens API security with Apigee API Management to prevent data loss

Drive active customer engagement for faster customer acquisition and revenue growth

People in urban cities can often find a bank branch or ATM at every corner. But that’s not the case for millions of people in rural Philippines who travel long distances for banking services and need to arrive before the bank closes. Tonik provides consumers with the convenience of banking anytime, powered by Google Cloud Apigee. All they need to do is to download the Tonik app on their mobile device, verify their identity for account opening, and start banking.

“Everything on our digital banking app is API-driven. Apigee API Management is the foundation of our architecture, helping us unlock new digital channels and build different business models.”

Arivuvel Ramu, Chief Technology Officer, Tonik Bank

Aligned with Bangko Sentral ng Pilipinas (BSP), the Philippines’ central bank’s strategy to improve financial inclusion with open banking, Tonik uses Apigee to build and scale open banking APIs for its app. Instead of starting from scratch, Tonik speeds up time to market by adding digital services from third-party providers to its app. This allows developers to focus on improving its mobile app experience to better engage customers.

“Everything on our digital banking app is API-driven. Google Apigee API Management is the foundation of our architecture, helping us unlock new digital channels and build different business models,” says Arivuvel Ramu, Chief Technology Officer at Tonik Bank.

“While APIs are not new to conventional banks, they tend to be private APIs tailored for a specific partner, which means third parties cannot reuse that API. Our strategy is to develop private APIs and then convert them into public APIs to support innovation in our ecosystem. Developers can use our APIs on Apigee to create new apps and services for customers in a shorter time,” Ramu adds.

An example is how Tonik interoperates with Daon for onboarding and biometric authentication. BSP requires banks to perform due diligence by verifying the customer’s identity to prevent fraud and money laundering. Traditionally, customers present valid government identifications (ID) to an officer at a physical branch to apply for an account. Tonik automates this process by asking the customer for a selfie along with a scanned copy of their ID. Using Vision AI / Document AI, Tonik extracts text from the images via optical character recognition (OCR) and shares the information with Daon through a trusted API. Daon then cross-checks the customer’s identity against relevant sources that issued the ID. The complex data flow is transparent to the app user who is onboarded in under five minutes instead of the usual lead time of several hours or even three banking days.

To solve consumers’ number-one concern, “Where can I deposit or withdraw cash?” Tonik works with its ecosystem partners such as 7-Eleven convenience stores and pawnshops readily available all over the Philippines. Using APIs, Tonik exchanges data securely with authorized partners to capture transactions in real time or near real time. That means when customers make a deposit at a 7-Eleven they see their transaction on their app and start earning interest right away.

“Apigee helps us comply with regulatory requirements such as PSD2 by capturing and managing customer consent on what data we’re permitted to share with authorized third parties. At the same time, Apigee secures our APIs to minimize data breaches by malicious users.”

Arivuvel Ramu, Chief Technology Officer, Tonik Bank

An API-first approach to next-gen financial services

Tonik helps partners get started with an Apigee developer portal to register their apps and access API documentation and tools. They can run pre-configured API proxies in an isolated sandbox environment to prevent potential mistakes that result in customer downtime. Developers can request an access token when they are ready to put the API into production.

“For open banking to succeed, digital banks must consider consent management and API security. That’s because customers trust us with their sensitive data such as demographic and transaction data,” says Ramu. “Apigee helps us comply with regulatory requirements such as PSD2 by capturing and managing customer consent on what data we’re permitted to share with authorized third parties. At the same time, Apigee secures our APIs to minimize data breaches by malicious users.”

“Deep Knowledge plays a crucial role in helping us understand our Tonik customers. With a goal to accelerate financial inclusion in the Philippines, our data lake on Google Cloud and Open Finance using Apigee API Management can help us deliver the right product to the right customer at the right time.”

Arivuvel Ramu, Chief Technology Officer, Tonik Bank

Scaling for growth with hyper personalized customer experiences via data insights on Google Cloud Data lake

Moving forward, Tonik wants to grow its active customer base from over 130,000 (as of November 2021) to a million in December 2022. To achieve this target, Tonik wants to improve customer experience by turning data into insights.

Data is generated from every event along the customer journey. For example, a cloud-based contact center software captures the omnichannel customer interactions and feedback while the core banking system captures deposits and withdrawals. All data reside in different systems, which makes it challenging to connect datasets and analyze them manually as the data grows.

Tonik aims to build a digital lake by December 2021 using BigQuery and Cloud Storage on Google Cloud to unify data from different data sources through data pipelines. A potential use case is to identify the risky lending customer and their repayment pattern, collection, and defaulter extract under Credit MIS, and reward new customers with a sign-up bonus if they deposit a specific amount. Traditional banks can’t identify such customers in real time because they run ledgers quarterly or monthly.

At the same time, the neobank plans to help Filipinos get loans even without credit history. By applying machine learning to variables such as login patterns and payment history, Tonik can predict a customer’s trustworthiness and approve the right amount of loan.

“Deep Knowledge plays a crucial role in helping us understand our Tonik customers,” says Ramu. “With a goal to accelerate financial inclusion in the Philippines, our data lake on Google Cloud and Open Finance using Apigee API Management can help us deliver the right product to the right customer at the right time.”

Tell us your challenge. We're here to help.

Contact us

About Tonik

Launched in March 2021, Tonik is the first purely digital neobank in the Philippines, and one of the very few neobanks globally that is operating on the basis of its own full digital bank license granted by the Bangko Sentral ng Pilipinas (BSP). Its mission is to make banking accessible to millions of customers on a secure digital platform that’s available anytime, anywhere. The neobank provides flexible and inclusive financial services including industry-leading deposit interest rates of up to 6% per annum, and unique saving features such Solo and Group Stash products. Through an ecosystem of partners, Tonik provides financial services such as savings, loans, and much more.

Location: Philippines