The Bangko Sentral ng Pilipinas (BSP) is reviewing applications from prospective digital banks seeking to operate in the Philippines starting this year.
“We’re going to allow four more digital banks in the near future. So, we expect to have 10 digital banks. We have seen a lot of applications from banks with very successful business models abroad,” BSP Governor Eli Remolona, Jr. said in a speech at a Rotary Club membership meeting last week.
“We’re just checking on their data. And then very soon we will allow a few more digital banks,” he said.
The BSP allowed more digital banks to operate in the country to promote lending digitally.
It granted digital banking licenses to Maya Bank, Overseas Filipino Bank Inc., Tonik Digital Bank Inc., UNObank Inc., UnionDigital Bank and GoTyme Bank Corp.
It lifted the moratorium on new digital banking licenses starting Jan. 1, 2025.
“In terms of payments, we are looking to payments as a pathway towards financial inclusion. Digital payments, we see as allowing more people to have –not necessarily a bank account, but an e-wallet account, which then makes it easier for them to open a bank account eventually,” Remolona said.
“And then with digital banks relying on data that is new and innovative, we are hoping that they will be able to lend to more people without requiring the usual amount of collateral that banks have so far relied on. So that’s our strategy. It’s part of our strategy for financial inclusion,” he said.
The BSP also considered a fixed subscription fee model for digital transactions as an alternative to the current per-transaction fee structure to maximize network externalities in the payment system.
“We want to try to maximize that by looking at the fee structure –rely less on fees per transaction and rely more on subscriptions, which is kind of a fixed cost,” Remolona said.
“We hope that this will lead to greater financial inclusion,” he said.
The BSP set the minimum capitalization of digital banks at P1 billion, but said a digital bank may be subject to higher minimum capital requirement and capital ratio based on its assessment of the risk profile of the bank.