MANILA, Philippines — Yuchengco-led Rizal Commercial Banking Corp. (RCBC) has tied up with IBM to issue fiat currency backed
stablecoins to provide a better and faster remittance platform for overseas Filipino workers.
Stablecoins are virtual currencies that carry fixed values as they are pegged to a particular currency, while IBM’s World Wire has the capacity to simultaneously clear and settle cross-border transactions to almost real-time efficiency.
RCBC global transaction banking group head Emmanuel Narciso said the bank is pleased to be an early innovator with its intent to issue its own peso stable coin on World Wire.
“We’re focused on innovation that adds value to our customers and partners, and World Wire presents a tremendous opportunity to transform and enhance our payment infrastructure,” he said.
The plan has yet to receive final approval from regulators led by the Bangko Sentral ng Pilipinas (BSP).
RCBC is one of six banks around the world that expressed intention to issue stablecoins on IBM‘s World Wire.
The planned issuance of stablecoins would render international remittance transactions faster and easier for RCBC’s clients and partners beyond Philippine borders, and will greatly benefit Filipinos working overseas.
To date, Filipinos working and living abroad are charged between two and seven percent for every $200 sent home from abroad.
At times, foreign currencies sent from abroad are also affected by the foreign exchange difference in the country as against the local currency’s value in the international market.
“This ultimately results in a lower value remitted to OFW beneficiaries. While the amounts may seem small, when converted to local currency the charges do hurt their pockets,” Narciso said.
With stable coins, overseas Filipinos could buy coins using their dollars or any foreign currency on hand and send it to their loved ones in the Philippines for redemption.
“If an OFW buys $1,000 worth of Philippine peso stablecoins and the coins are priced at P50 per coin, the OFW gets 20 coins. He can send these coins to the Philippines, and his loved ones can redeem the coins in peso value which is P50,000,” Narciso said.