The announcement that Higala, a banking and payments startup based in the Philippines, has raised $4 million in seed funding marks a noteworthy step toward expanding digital financial inclusion in this part of the world. When I first came across the news, I immediately thought about the uphill battle that smaller financial institutions face in entering tech-driven markets. This funding round points to a possible solution that might tip the scale in their favor.
Let’s break it down. Higala’s core service focuses on providing foundational digital banking and payment tools for rural banks and microfinance organizations. These smaller institutions often don’t have the resources to build or maintain sophisticated digital systems. By offering platform banking options, Higala shoulders the technical burden, leaving banks free to focus on customer service and scaling their loan portfolios.
Where the Money Will Go
A closer look at Higala’s strategy reveals how the funding will be used to tackle some highly specific challenges:
- Onboarding Rural Banks: Eight institutions are already collaborating with Higala, with a goal to onboard over 40 more. The aim, presumably, is to create a critical mass of small players embracing digital channels.
- Building Resilience Into Financial Systems: Many fintech advancements focus on urban markets, while rural communities remain largely underserved. Higala taps into an untapped demographic by making digital banking affordable and scalable.
- Reducing Costs: Transaction fees are often a chokepoint for financial inclusion. By deploying open-source technologies, the company plans to lower these costs by as much as 60%.
Why This Matters Now
Southeast Asia is already home to a growing portfolio of fintech companies, but less attention is given to how these tools reach marginalized communities. Larger banks in the region typically dominate payment ecosystems, leaving smaller institutions, especially rural firms, in a permanent state of lag.
Higala aims to remove these barriers by pairing payments infrastructure with tools for financial inclusivity. Their approach integrates open-source software like Mojaloop into local markets, potentially bridging a gap that’s long overdue for closure.
Let’s Talk Partnerships
It’s impressive to see Higala pulling in strategic backers like Chemonics International and Talino Venture Studios. Both entities bring distinct expertise, Chemonics with its focus on sustainable finance and Talino with its fintech development capabilities. Together, they provide a balanced mix of execution power and strategic development.
One interesting aspect is their use of open architecture that both enables customization and speeds up deployment. It feels like an antidote to the struggles many businesses face when scaling digital products.
If we think globally, similar initiatives in other emerging markets like Latin America have shown that when smaller banks are enabled to modernize, they can pull entire communities into the realm of digital finances, creating opportunities for employment, education, and entrepreneurship.
The Model to Emulate
From my perspective, Higala’s business model is worth studying, especially for entrepreneurs looking to build an ecosystem that balances profit and social impact. Leveraging technology for inclusivity is no easy feat but offers numerous teaching points:
- Start Small: Higala began its pilot program with eight rural banks. New ventures can learn the value of starting with manageable numbers before scaling upward.
- Form Strategic Alliances: By enlisting entities that complement your weaknesses, you increase your chances of long-term stability.
- Understand Local Markets: Higala’s customization abilities show how important it is to respect regional diversity in financial needs. Sustainability isn’t about imposing one-size-fits-all solutions, it requires deep local engagement.
Steps to Replicate Higala’s Success
If you’re thinking of building a fintech startup aimed at inclusivity, here’s a simple how-to guide modeled after aspects of Higala’s operations:
- Identify the Gap: Pinpoint where your target demographic struggles with adopting financial tools.
- Think Accessibility First: Price and simplicity are two immediate hurdles. Solve for those before investing heavily in fancy features.
- Find Strong Backers: Seek partnerships with firms that counterbalance your weaknesses but align with your values.
- Run a Small Pilot: Use early collaborations as proof of concept to attract funding for the long run.
- Use Open Source Wisely: It economizes your operations and builds trust, as clients understand they’re not locked into proprietary systems.
Common Mistakes to Avoid
Even good ideas can fall short if mismanaged. Watch for these pitfalls:
- Don't stretch your focus across too many segments. Companies like Higala target specific gaps in the market, in their case, services to rural banks, and build expertise from there.
- Avoid neglecting local partnerships. Financial inclusion depends on the buy-in of regional players who understand their audience.
- Resist scaling too quickly. Building trust and establishing smooth operations takes time. Expanding before processes are solid can damage credibility.
Closing Thoughts
What we’re seeing here with Higala is an attempt to level the playing field for banking institutions that have long been excluded from tech-based transformation. It’s also a good reminder that some steps toward progress may not involve “disruption.” Sometimes, building bridges through collaboration is just as effective.
If you’re curious about Higala’s methods or want to understand what sets them apart, explore their partnerships with Chemonics and Talino. These collaborations highlight the success that can come from pairing clear social missions with practical financial tools.
FAQ
1. What is Higala's primary goal as a startup?
Higala aims to expand digital financial inclusion by offering payment and banking infrastructure to smaller financial institutions such as rural banks and microfinance organizations in the Philippines. Discover Higala’s Mission
2. How much funding did Higala raise and who were their strategic backers?
Higala raised $4 million in a seed funding round with backing from Chemonics International and Talino Venture Studios, combining expertise in financial inclusion and fintech innovation. Learn more about Higala’s funding
3. What technology does Higala use to lower transaction costs?
Higala uses open-source platforms like Mojaloop to create affordable, interoperable payment systems, reducing transaction costs by up to 60%. Discover Mojaloop Technology
4. How does Higala support rural banks?
Higala provides platform banking services, enabling rural banks to deploy digital systems quickly and affordably, thus allowing them to focus on customer service and loan portfolio growth. Explore Higala’s support for rural banks
5. What makes Higala’s partnership model unique?
Higala combines the operational expertise of Chemonics International with Talino Venture Studios’ fintech development capabilities to deliver scalable financial solutions. Learn more about Higala’s partnerships
6. How many banks has Higala onboarded so far?
As of now, Higala has onboarded eight rural banks and plans to expand to over 40 institutions soon. Check out Higala’s expansion plans
7. What challenges does Higala address in the Philippines’ banking landscape?
Higala targets gaps like high transaction fees and limited access to digital banking tools, which are especially prevalent among rural banks and underserved communities. Discover Higala’s impact
8. What role do open-source systems play in Higala’s model?
Higala leverages open-source architecture to enable customization, interoperability, and affordability in implementing digital solutions for financial institutions. Explore Higala’s open-source approach
9. How is Higala contributing to financial inclusion?
By making digital banking affordable and scalable, Higala is helping underserved communities join the digital economy, promoting employment, education, and entrepreneurship. Learn about Higala’s inclusive impact
10. Can Higala’s model be adapted to other regions?
Yes, Higala plans to replicate its success in the Philippines in other emerging markets, such as Southeast Asia and Latin America. Discover Higala’s global potential
About the Author
Violetta Bonenkamp, also known as MeanCEO, is an experienced startup founder with an impressive educational background including an MBA and four other higher education degrees. She has over 20 years of work experience across multiple countries, including 5 years as a solopreneur and serial entrepreneur. Throughout her startup experience she has applied for multiple startup grants at the EU level, in the Netherlands and Malta, and her startups received quite a few of those. She’s been living, studying and working in many countries around the globe and her extensive multicultural experience has influenced her immensely.
Violetta Bonenkamp's expertise in CAD sector, IP protection and blockchain
Violetta Bonenkamp is recognized as a multidisciplinary expert with significant achievements in the CAD sector, intellectual property (IP) protection, and blockchain technology.
CAD Sector:
- Violetta is the CEO and co-founder of CADChain, a deep tech startup focused on developing IP management software specifically for CAD (Computer-Aided Design) data. CADChain addresses the lack of industry standards for CAD data protection and sharing, using innovative technology to secure and manage design data.
- She has led the company since its inception in 2018, overseeing R&D, PR, and business development, and driving the creation of products for platforms such as Autodesk Inventor, Blender, and SolidWorks.
- Her leadership has been instrumental in scaling CADChain from a small team to a significant player in the deeptech space, with a diverse, international team.
IP Protection:
- Violetta has built deep expertise in intellectual property, combining academic training with practical startup experience. She has taken specialized courses in IP from institutions like WIPO and the EU IPO.
- She is known for sharing actionable strategies for startup IP protection, leveraging both legal and technological approaches, and has published guides and content on this topic for the entrepreneurial community.
- Her work at CADChain directly addresses the need for robust IP protection in the engineering and design industries, integrating cybersecurity and compliance measures to safeguard digital assets.
Blockchain:
- Violetta’s entry into the blockchain sector began with the founding of CADChain, which uses blockchain as a core technology for securing and managing CAD data.
- She holds several certifications in blockchain and has participated in major hackathons and policy forums, such as the OECD Global Blockchain Policy Forum.
- Her expertise extends to applying blockchain for IP management, ensuring data integrity, traceability, and secure sharing in the CAD industry.
Violetta is a true multiple specialist who has built expertise in Linguistics, Education, Business Management, Blockchain, Entrepreneurship, Intellectual Property, Game Design, AI, SEO, Digital Marketing, cyber security and zero code automations. Her extensive educational journey includes a Master of Arts in Linguistics and Education, an Advanced Master in Linguistics from Belgium (2006-2007), an MBA from Blekinge Institute of Technology in Sweden (2006-2008), and an Erasmus Mundus joint program European Master of Higher Education from universities in Norway, Finland, and Portugal (2009).
She is the founder of Fe/male Switch, a startup game that encourages women to enter STEM fields, and also leads CADChain, and multiple other projects like the Directory of 1,000 Startup Cities with a proprietary MeanCEO Index that ranks cities for female entrepreneurs. Violetta created the "gamepreneurship" methodology, which forms the scientific basis of her startup game. She also builds a lot of SEO tools for startups. Her achievements include being named one of the top 100 women in Europe by EU Startups in 2022 and being nominated for Impact Person of the year at the Dutch Blockchain Week. She is an author with Sifted and a speaker at different Universities. Recently she published a book on Startup Idea Validation the right way: from zero to first customers and beyond, launched a Directory of 1,500+ websites for startups to list themselves in order to gain traction and build backlinks and is building MELA AI to help local restaurants in Malta get more visibility online.
For the past several years Violetta has been living between the Netherlands and Malta, while also regularly traveling to different destinations around the globe, usually due to her entrepreneurial activities. This has led her to start writing about different locations and amenities from the POV of an entrepreneur. Here’s her recent article about the best hotels in Italy to work from.
About the Publication
Fe/male Switch is an innovative startup platform designed to empower women entrepreneurs through an immersive, game-like experience. Founded in 2020 during the pandemic "without any funding and without any code," this non-profit initiative has evolved into a comprehensive educational tool for aspiring female entrepreneurs.The platform was co-founded by Violetta Shishkina-Bonenkamp, who serves as CEO and one of the lead authors of the Startup News branch.
Mission and Purpose
Fe/male Switch Foundation was created to address the gender gap in the tech and entrepreneurship space. The platform aims to skill-up future female tech leaders and empower them to create resilient and innovative tech startups through what they call "gamepreneurship". By putting players in a virtual startup village where they must survive and thrive, the startup game allows women to test their entrepreneurial abilities without financial risk.
Key Features
The platform offers a unique blend of news, resources,learning, networking, and practical application within a supportive, female-focused environment:
- Skill Lab: Micro-modules covering essential startup skills
- Virtual Startup Building: Create or join startups and tackle real-world challenges
- AI Co-founder (PlayPal): Guides users through the startup process
- SANDBOX: A testing environment for idea validation before launch
- Wellness Integration: Virtual activities to balance work and self-care
- Marketplace: Buy or sell expert sessions and tutorials
Impact and Growth
Since its inception, Fe/male Switch has shown impressive growth:
- 5,000+ female entrepreneurs in the community
- 100+ startup tools built
- 5,000+ pieces of articles and news written
- 1,000 unique business ideas for women created
Partnerships
Fe/male Switch has formed strategic partnerships to enhance its offerings. In January 2022, it teamed up with global website builder Tilda to provide free access to website building tools and mentorship services for Fe/male Switch participants.
Recognition
Fe/male Switch has received media attention for its innovative approach to closing the gender gap in tech entrepreneurship. The platform has been featured in various publications highlighting its unique "play to learn and earn" model.
