BSP authorizes 2 new digital banks’ full operations

The central bank has issued certificates of authority to two additional banks, bringing to six the number of digital banks allowed to proceed with full operations.

“The most recent recipients were UnionDigital Bank Inc. and GoTyme Bank Corp., which obtained their certificates on July 12 and 29, respectively,” the Bangko Sentral ng Pilipinas said.

In the first quarter of 2022, the BSP authorized Tonik Digital Bank Inc. and Maya Bank Inc. to operate as digital banks, while Overseas Filipino Bank Inc., a digital bank of LandBank, and UNObank Inc. were authorized in the second quarter.

The BSP issues the COA to Operate to digital banks that have substantially complied with the BSP’s conditions for approval and pre-operating requirements.

These include capitalization, risk and governance structure, and information technology systems.

Securing a COA to operate begins with the application to establish a digital bank, approved by the Monetary Board.

“Once the MB approves, the BSP issues a COA to Register, to be submitted to the Securities and Exchange Commission. After registration and completion of all other requirements, digital banks may obtain the COA to Operate from the BSP,” the BSP added.

OFBDB, TONDB and MAYA are now fully operational, while UBI, UDB and GTYME have commenced limited operations targeting select customers.

Operating initially under limited capacity is a conservative approach adopted by digital banks to ensure further that all aspects of their digital operations are ironed out before fully launching their services to the public.

UBI, UDB and GTYME are expected to launch publicly within the second half of this year.

Digital banks, unlike brick-and-mortar banks, have no physical branches. Their financial products and services are processed end-to-end through digital or electronic channels.

From January to June 2022, the volume and value of electronic payments and financial services processed through digital banks reached 1.4 million transactions and P8.45 billion, respectively.

“The operations of digital banks support the BSP’s Digital Payments Transformation Roadmap, which aims to digitalize half of the total volume of retail payments in the country, and onboard at least 70 percent of Filipino adults into the formal financial system by 2023,” the central bank added.

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