Connect with us

Hi, what are you looking for?

Economy

BSP approves regulatory framework for digital banks

THE MONETARY BOARD has approved a regulatory framework for digital banks, Bangko Sentral ng Pilipinas (BSP) Governor Benjamin E. Diokno said on Thursday.

“We see these [digital] banks as additional partners in further promoting market efficiencies and expanding access of Filipinos to a broad range of financial services,” Mr. Diokno told reporters via Viber.

Under the framework, digital lenders will be classified differently from universal, commercial, thrift, rural, cooperative, and Islamic banks.

The Monetary Board may also limit the number of digital banks that may be established, considering the total number of applications received and the current banking landscape in the country.

“Essentially, the BSP is looking to attract players with strong value proposition, sufficient financial strength, technical expertise of management and effective risk management,” Mr. Diokno said.

The latest draft of the framework was released last month. Among the proposed provisions was a minimum capital requirement of P1 billion for digital banks.

The approved framework has yet to be released.

BSP Deputy Governor Chuchi G. Fonacier confirmed in a text message on Thursday that the minimum P1-billion capital requirement was retained in the approved framework.

Digital banks need to pay the BSP a P250,000 application fee and a P12.5-million license fee, based on the latest proposal.

These lenders are also expected to maintain a main office for management and support operations for customer concerns and as a point of contact for the BSP and other regulators, the central bank said.

“Digital banks are also allowed to tap cash agents and other qualified service providers subject to existing regulations to complement the innovative delivery of financial services,” it added.

Mr. Diokno has said that digital banks could help the BSP achieve its goal to bring 70% of adult Filipinos into the financial system and to have at least 50% of payments by volume and value done digitally by 2023.

Only 29% of Filipino adults had accounts with financial institutions as of 2019, leaving some 51.2 million unbanked, BSP data showed.

Meanwhile, e-payments made up 10% of the total transaction volume in the country in 2018 from only 1% in 2013, data from the Better Than Cash Alliance showed. By value, online transactions made up 20% of the total in 2018 from just 8% in 2013.

“It is our long-term goal to see more digital-savvy Pinoys, such that it becomes second nature for them to perform routine financial transactions online — making payments and fund transfers, or availing of credit, insurance, and investments,” Mr. Diokno said in a forum on Thursday. — L.W.T. Noble

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Get the daily email that makes reading the news actually enjoyable. Stay informed and entertained, for free.
Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!

Latest

Economy

PHILIPPINE SHARES may move sideways this week amid an expected rate hike by the Bangko Sentral ng Pilipinas (BSP) at its Aug. 18 meeting...

Economy

THE PESO may strengthen this week on expectations that the central bank will raise benchmark rates anew at its meeting on Thursday.  The local...

Economy

THE Philippine Economic Zone Authority (PEZA) said it considers a downgraded investment growth target for 2022 of 6-7% to be within reach after investment...

Economy

NORWAY’s ambassador said the Philippines is a potential destination for Norwegian businesses, but their interest in renewable projects here will depend on the industry’s...

Economy

THE government’s chief economic planner said the Philippines must minimize its exposure in case the geopolitical situation deteriorates, with analysts citing the potential of...

Economy

THE new president of the Bases Conversion and Development Authority (BCDA) is a career official in the agency and the first woman to head...

You May Also Like

Investing

Having a good Instagram marketing agency to back up your Instagram account is an absolute must going into the new year. With competition stronger...

Economy

Ivermectin, an existing drug against parasites including head lice, has had a checkered history when it comes to treating COVID-19. The bulk of studies...

Investing

Insomnia is the most common sleep disorder in the global population. Therefore, it is a problem that many people suffer or have suffered throughout...

Investing

Instagram still holds the top spot for social media in terms of building brand reputation and expanding business potential. Every day, more and more...

Disclaimer: SmartRetirementReport.com, its managers, its employees, and assigns (collectively "The Company") do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2021 SmartRetirementReport. All Rights Reserved.