MANILA - The Bangko Sentral ng Pilipinas' (BSP) Monetary Board has officially recognized "digital bank" as a new bank category, in line with its Digital Payments Transformation Roadmap which seeks to streamline financial technology in the country.
The BSP defines "digital bank" as a bank that offers financial products and services that are processed end-to-end through a digital platform and/or electronic channels with no physical branches.
“Digital banks will play an important role in the digital financial ecosystem. We see these banks as additional partners in further promoting market efficiencies and expanding access of Filipinos to a broad range of financial services, bringing us closer to the realization of our target that at least 50 percent of total retail payment transactions have shifted to digital, and 70 percent of adult Filipinos have transaction accounts by year 2023,” BSP Governor Benjamin Diokno said in a statement Monday.
With the new classification, the BSP will require and subject digital banks to "same prudential requirements" like other bank types to protect them from financial risks.
The central bank is currently crafting regulatory framework for digital banks, anticipating the arrival of local and foreign players.
Diokno reiterated earlier statements that the Monetary Board may limit the number of digital banks in the Philippines, looking for players who have "strong value proposition, sufficient financial strength, technical expertise of management and effective risk management.”
- COVID-19 pandemic highlights 'increasing importance' of digital transactions: BSP
- 'High tech, low touch' is new normal as banks see economy through COVID-19