MANILA, Philippines – The Bangko Sentral ng Pilipinas (BSP) expects an exponential increase in online banking transactions as the three remaining digital banks, which recently obtained licenses, are expected to begin business operations within the year.
In his weekly online press briefing, BSP Governor Benjamin Diokno said UNO Digital Bank, Union Digital Bank as well as GoTyme Bank are expected to begin business operations within the year.
“Now we expect the volume and value of transactions to increase exponentially when other digital banks begin operations,” he said.
Of the six entities to which the BSP has granted digital banking licenses, three are already operational: Overseas Filipino (OF) Bank, Tonik Digital Bank as well as Maya Bank of PLDT’s Voyager and PayMaya.
For OF Bank and Tonik Bank, Diokno said the two who converted their licenses to digital banks were able to open 120,000 additional deposit accounts in less than a year.
With a seamless and innovative customer experience in a mobile account opening app and with the relaxation of regulatory requirements for Basic Deposit Accounts (BDAs), the BSP chief said that the usual barriers to opening deposit accounts have been resolved.
Diokno said the BSP continues to improve regulations to promote a secure environment for digital banks.
This includes the recent publication amending information technology (IT) risk management policies, in particular on the implementation of automated and real-time monitoring and fraud detection systems.
Additionally, the BSP has always been proactive in promoting cyber resilience and promoting the zero trust model to strengthen cybersecurity and IT risk management regulations.
“Digital banks will significantly contribute to the growth and development of the digital financial ecosystem, catalyzing the achievement of BSP’s financial inclusion and digital transformation goals,” Diokno said.
As part of the Digital Payments Transformation Roadmap, BSP aims to convert 50% of total retail transactions to electronic channels and increase the number of Filipino adults with bank accounts to 70% by 2023.
Diokno said digital banks should support economic recovery by improving financial accessibility for micro, small and medium enterprises (MSMEs).
“By offering convenient and affordable financial products tailored to the needs of MSMEs, digital banks can accelerate financial inclusion in the country,” Diokno said.
Digital banks, unlike physical banks, do not have physical branches. Their financial products and services are processed end-to-end through a digital platform or electronic channel.
In addition to offering traditional savings and term deposit accounts, digital banks are also seen as improving MSMEs’ access to credit through mobile-friendly lending and investment facilities.
Additionally, digital records of sales and payment transactions can be used to assess the creditworthiness of MSME borrowers.
“BSP remains committed to fostering a regulatory environment conducive to financial innovation, while promoting healthy competition in the financial system,” Diokno said.