CEBU — Four additional digital banks could start operating as early as next year with the lifting of a moratorium on new licenses, a Bangko Sentral ng Pilipinas (BSP) official said.
“Normally, the chartering is completed within 3 to 4 months, assuming that they have already submitted all the requirements [they can operate already],” Melchor Plabasan, senior director of the BSP Technology Risk and Innovation Supervision Department (TRISD), told reporters at the sidelines of the BSP-IMF Systemic Risk Dialogue on Wednesday.
Plabasan said that both existing banking industry players and foreign entities had expressed interest in the upcoming licensing window.
Existing players are exploring the possibility of license conversion while foreign firms have inquired about regulatory requirements for entering the market, he added.
“We’ve already received some queries about legal and regulatory requirements. By January 1, we’ll have completed assessments of existing players and start accepting new applications,” Plabasan said.
The BSP lifted the moratorium on licenses last August, making four additional slots available and allowing up to 10 digital banks to operate in the country.
Rules governing the establishment of digital banks were released in 2020 and six licenses were subsequently issued. The BSP stopped accepting applications less than a year later, saying it wanted to monitor the impact of digital banks on the financial sector.
The four additional licensees will either be new or converting banks, Plabasan said, adding that some banks are already functioning like digital banks despite holding rural or thrift bank licenses.
These institutions, he said, may be required to transition their licenses to align with the operational and regulatory standards of digital banks.
“If you’re already behaving like a digital bank, you should be regulated like one, not as a rural bank,” Plabasan continued, emphasizing the need to minimize regulatory arbitrage.
“That means all the requirements for digital banks will have to be complied [with] by these institutions, like the P1 billion capital and other prudential requirements,” he added.
While the BSP has allocated four slots for new digital banks, Plabasan clarified that it would not automatically award all licenses.
“They have to offer something new to the table. So if no one meets the additional requirements, then we will stay with the existing number,” he added.
The six digital banks currently operating in the Philippines are UNO Digital Bank, Tonik Digital Bank, UnionDigital Bank, Overseas Filipino Bank (OFBank), Maya Bank and GoTyme Bank.
UNO and Tonik are owned by Singapore-based firms while OFBank is managed by the state-owned Land Bank of the Philippines. UnionDigital, Maya and GoTyme are owned by Union Bank of the Philippines, the PLDT Group and the Gokongwei Group, respectively.
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