The Bangko Sentral ng Pilipinas (BSP) said the emergence of digital banks can be a game-changer on the delivery of financial products and services from traditional brick-and-mortar banks.
During a recent webinar hosted by the Management Association of the Philippines, BSP governor Benjamin E. Diokno said the rise of digital banks can drive the digital transformation initiatives of existing banks as a way of staying relevant and competitive.
He also explained that as new entrants provide affordable financial services to the mass market, digital banking can advance financial inclusion, usher prosperity, and alleviate poverty. “In all of these, the customers and the business community are the ones who will reap the benefits,” Diokno pointed out.
Digital banks offer financial products and services that are processed end-to-end through a digital platform and/or electronic channels with no physical branch/sub-branch or branch-lite unit offering financial products and services
To date, the Monetary Board has approved the application of six digital banks. Based on their profiles, these digital banks intend to serve Overseas Filipino Workers, as well as the underserved, unbanked and mass market. However, they may also venture into investments, insurance, and payment services.
Digital banking is a key component of the BSP’s Digital Payment Transformation Roadmap which aims to convert at least 50 percent of the total volume of retail payments into digital form and to onboard at least 70 percent of Filipino adults to the financial system through the ownership and use of a transaction account.