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Philippines: BSP allows 6 digital banks to operate
THE Bangko Sentral ng Pilipinas (BSP) said it has allowed a total of six digital banks to operate in the Philippines.
BSP said in a statement that it recently granted two different banks certificates of authority (COAs) to operate in the country. The most recent beneficiaries were GoTyme Bank Corp. (GTYME) and UnionDigital Bank Inc. (UDB).
The central bank gave UDB the certificate to operate on July 12, 2022 while GTYME got the same document on July 29, 2022.
The BSP granted permission for Tonik Digital Bank Inc. and Maya Bank Inc. to function as digital banks in the first quarter of 2022.
During the second quarter of 2022, the BSP approved the operations of UNObank Inc. (UBI) and the state-owned digital bank Overseas Filipino Bank Inc. (OFBDB).
UBI, UDB and GTYME have started limited operations aimed at a small number of consumers.
Meanwhile, OFBDB, TONDB and Maya are already fully operational.
The BSP issues the COA to operate digital banks that comply with its conditions for approval and pre-operating requirements.
These conditions include capitalization, governance and risk management plans, among others.
The application to create a digital bank, which must be accepted by the Monetary Board, is the first step toward obtaining a COA to operate.
The BSP grants a COA to register, which is then filed to the Securities and Exchange Commission after being authorized by the Monetary Board.
Digital banks can then get the BSP’s COA to operate after registering and fulfilling all other conditions.
The cautionary strategy used by digital banks to further ensure that all facets of their digital operations are worked out before fully providing their services to the general public is to operate initially with restricted capacity.
The public launches of UBI, UDB and GTYME are anticipated to occur in the second part of this year. Digital banks do not have physical branches compared to the traditional banks.
From January to June 2022, the volume and value of electronic payments and financial services processed through digital banks reached 1.4 million transactions and P8.45 billion, respectively.
The operations of digital banks support the BSP’s Digital Payments Transformation Roadmap, which aims to digitalize half of the total volume of retail payments in the country and onboard at least 70 percent of Filipino adults into the formal financial system by 2023.
Source: https://www.manilatimes.net/2022/08/25/business/top-business/bsp-allows-6-digital-banks-to-operate/1855852