MANILA, Philippines — UnionDigital Bank Inc., a wholly owned subsidiary of Aboitiz-led Union Bank of the Philippines, received the green light from the Bangko Sentral ng Pilipinas (BSP) to operate as a digital bank.
In a disclosure to the Philippine Stock Exchange (PSE), UnionBank said UnionDigital Bank received the Certificate of Authority to Operate as a digital bank on July 12.
“This is the final stage in the three-stage digital bank application process,” it said.
To pursue its digital transformation journey, the bank is launching UnionDigital Bank Inc. also in the second half of the year.
In July last year, the BSP granted a digital banking license to UnionDigital. It is the only digital bank established by a universal bank among the six licensees approved by the regulator.
The Securities and Exchange Commission (SEC) approved the Articles of Incorporation and By-Laws of UnionDigital Bank in November last year. As part of its incorporation, UnionBank subscribed to 100 million new common shares of UnionDigital Bank at a par value of P10 per share amounting to P1 billion.
Last month, UnionBank approved a P2-billion capital infusion to UnionDigital Bank.
UnionBank president and CEO Edwin Bautista earlier said UnionDigital is the bank’s foray to penetrate the larger untapped retail segment in the country in a purely digital and cost-effective manner.
“Our digital bank UnionDigital, is also on-track to launch by the second half of the year. We are closely working with the regulators to complete key requirements for the start of our operations,” Bautista said.
Unlike brick and mortar banks, digital banks have no physical branches and their financial products and services are processed end-to-end through a digital platform or electronic channel.
Aside from offering traditional savings and time deposit accounts, digital banks are also improve the access of micro, small, and medium enterprises (MSMEs) to credit through mobile-friendly lending and investment facilities.