Philippine Banking Space Receives More Applications from Several Entities
On Monday, June 14, the Bangko Sentral ng Pilipinas (BSP) announced an increase in applications from entities seeking to enter the newly created digital banking space in the Philippines as more consumers shift from traditional to electronic channels.
BSP Deputy Governor Chuchi Fonacier stated that the regulator is currently evaluating three applications for a digital bank license, while another company has also expressed interest.
So far, BSP has given three banks the green light to operate as digital banks in the Philippines. Such banks are the Overseas Filipino (OF) Bank, Tonik Digital Bank, and UNObank.
UNObank Co-Founder and Chief Executive Officer Manish Bhai stated, “[UNObank] aims to bridge the financial inclusion gap to help pave the way for all Filipinos to have access to basic financial services.”
Bhai added, “BSP’s vision and foresight to digitize the local banking industry is future-forward and apt because ultimately it will help align the Philippines as a modern banking center for the region.”
In December 2020, BSP issued Circular No. 1105 recognizing digital banks as a new bank category separate from existing bank classifications.
Moreover, digital banks are defined as a type of bank that offers financial products and services that are processed end-to-end through a digital platform and electronic channels with no physical branches providing financial products and services.
The guidelines pegged the minimum capitalization of digital banks at P1 billion. Under the framework approved by the Monetary Board, the number of digital bank licenses is initially capped at five.