In the Know: 7-Eleven Plans to Expand into Fintech Industry

According to the Philippine operator of 7-Eleven, the convenience store chain may expand into Fintech and leverage its cash recycling ATMs.

7-Eleven is known for its diverse selection—from the frozen Slurpee to the 7-fresh Siopao, fanciful Chef’s Creations, budget-friendly Busog Meals, and more. But beyond food and day-to-day needs, the company lives up to its nature of being a convenience store by offering services like bill payments and e-wallet cash-ins.

And when Philippine Seven Corp (PSC)—the Philippine operator for the 7-Eleven franchise—noticed a growth in the latter, it knew that was high time to consider expanding into the Fintech industry. In fact, according to PSC president and CEO Victor Paterno, the “company will be announcing something soon” and that the convenience store operator has a role to play in becoming more inclusive in the finance industry.

A New Venture

Fintech—or financial technology for short—is defined as “a catch-all term referring to software, mobile applications, and other technologies [that are] created to improve and automate traditional forms of finance for businesses and consumers alike.” These include services like digital banking, blockchains for cryptocurrency and non-fungible tokens or NFTs, as well as e-wallet cash-ins, and more.

For convenience store chain 7-Eleven, these cash-ins from third-party apps like GCash and Maya have led to a growth in the company’s service income. With this service becoming a major contributor to the company’s profits, capitalizing on it would be a viable source of future growth.

“We believe that partnering with new digital players will be an opportunity that, because of our assets, we are uniquely positioned for,” Paterno said. “The thinking is that we were fortunate to have built and accumulated our digital assets when it was cheaper to do so, and we are now in a good position to monetize those assets by partnering with digital players who need access to them.”

7-Eleven’s Cash Recycling ATMs, Explained

Paterno even went on to add that the company’s cash recycling Automated Teller Machines (ATMs) are especially useful for financial inclusion.

But what exactly does cash recycling mean? For one thing, cash recycling allows ATMs to accept, validate, sort, and store banknotes quickly and reliably. Said banknotes can be made available to store operators who can deposit their sales for the day, which the machine then “recycles” as funds for the customers of partner banks to withdraw from.

And it works both ways. For the customer, ready cash is available and convenient, while cash replenishment costs for the financial institution (or in this case, the store operators) are reduced. What’s more, they can just deposit their money in these convenient ATMs.

This was created with the goal of making its convenient store more convenient. “We believe in financial inclusion, we do think that we have a role to play, [since] we think that people trust our brand,” Paterno said.

Now More Convenient Than Ever

To date, recycler ATMs have been installed in over 1,200 stores. According to 7-Eleven, there are plans to add at least 1,500 more cash recycler ATMs in 2022 across parts of Visayas and Mindanao. This was driven by sales data which showed that customers who moved out of Metro Manila at the height of the COVID-19 pandemic have yet to return.

Adding that sales in Metro Manila have weakened during the pandemic, while sales in the provinces—especially in Visayas and Mindanao—grew stronger, Paterno noted that this indicated that people were moving to the provinces. And despite the ease in restrictions and the return to onsite work for many companies, 7-Eleven’s data doesn’t indicate any changes to the prior trend.

This, coupled with President Ferdinand Marcos Jr’s promise that there will no longer be any lockdowns, gives businesses certainty. “So we really appreciate the guidance,” he said.

With trends continuing to look good, the company’s venture into Fintech shows promise. In fact, PSC shows signs of recovering, as it ended 2021 with total revenue of PHP 45.1 billion—up by 3.4% from 2020. However, the company still posted a net loss of PHP 461 million due to the pandemic, even though operating income climbed to PHP 448.2 million. 


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