Under a new framework, a digital bank is defined 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.
Under the digital banking framework, applicants are expected to have sound digital governance, robust, secure and resilient technology infrastructure, and effective data management strategy and practices, the BSP said.
Digital banks are expected to maintain a principal place of business in the Philippines to house the offices of management and other support operations. This will also serve as the main hub for customer concerns handling and as a point of contact for stakeholders, including regulators.
Under the framework, 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.
The BSP may limit the number of digital banks that may be established, considering the total number of applications received and the assessment of the overall banking situation.
Foreign individuals and non-bank corporations are allowed to hold 40% of the voting shares of a digital bank, in aggregate, while foreign banks are allowed to hold up to 100% of the voting shares.
The minimum capitalisation of a digital bank shall be at least PHP 1 billion (USD 20.8 million), though the BSP may subject a digital bank to a higher minimum capital requirement and capital ratio based on its assessment of the bank’s risk profile.
The application fee is PHP 250,000 and the license fee is PHP 12.5 million.
Applications are now being accepted. The framework is available here.
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