BSP mulls lifting ban on new digital banks

MANILA, Philippines — The Bangko Sentral ng Pilipinas (BSP) is looking at lifting the moratorium imposed on the granting of licenses to digital banks.

BSP Governor Eli Remolona Jr. told reporters that there are many groups, both foreign and local, that have expressed interest in obtaining a license from the central bank to operate digital banks.

“I’m hoping that we can begin issuing licenses again pretty soon,” Remolona said.

In August 2021, the BSP imposed a three-year moratorium on the grant of digital banking licenses to closely monitor the performance and impact of the new banking classification on the industry.

“There are many interested groups. The ball is on our court. We’re looking at the existing ones, the six digital banks that have licenses. Essentially, looking at their business models, we are learning and they are learning. And then once we get more comfortable with business models, we will allow more licenses for digital banks,” Remolona said.

The BSP has granted digital banking licenses to Overseas Filipino Bank Inc., Tonik Digital Bank Inc., UNObank Inc., Union Digital Bank of Aboitiz-led Union Bank of the Philippines, as well as GOtyme Bank Corp.  – a joint venture between the Gokongwei Group and Singapore-based digital bank Tyme.

Maya Bank emerged as the biggest digital bank in terms of assets with P23.22 billion as of end March, followed by UnionDigital Bank with P15.16 billion, Tonik Digital Bank with P10.71 billion, OF Digital Bank with P4.5 billion, UNObank with P3.05 billion and Gotyme with P2.74 billion.

Ma. Cynthia Sison, director of the Supervisory Policy and Research Department at the BSP, said the regulator is completing a study on the impact of the operations of the six digital banks.

“We’re still doing the study on the existing digital banks. Once we have completed that study, the decision whether to lift the moratorium or not will follow,” Sison said.

The BSP embarked on a Digital Payments Transformation Roadmap to convert 50 percent of total retail transactions in the country to electronic channels and to raise the number of Filipinos owning financial accounts to 70 percent by 2023.