Philippine central bank to grant up to 4 new digital bank licenses

The moratorium for new licenses will be lifted on 1 January 2025.

The Philippine central bank’s monetary board has lifted the moratorium on granting new digital banking licenses and is allowing a maximum of 10 digital banks to operate in the country.

The Bangko Sentral ng Pilipinas (BSP) can begin granting new digital bank licenses to up to 4 new entities when the moratorium is lifted on 1 January 2025.

“With this current complement, the lifting of the moratorium will accommodate four (4) additional licensees, coming from either new or converting banks,” said BSP governor Eli M. Remolona, Jr.

There are currently 6 digital banks operating in the Philippines. The BSP set this cap on 31 August 2021 in part to properly monitor the performance and impact of the digital banks in the local banking system, amongst others. 

Applicants will be subjected to a rigorous licensing process that will look into their value proposition, business models, and resources capabilities, the BSP said. 

They must also comply with standard licensing criteria that assesses the following: transparency of banks’ ownership and control structure, suitability of shareholders, fitness and propriety of directors and senior management, adequacy of capital, as well as banks’ strategic and operating plan.

“Applicants must bring something new to the table. We want to see unique product and service offerings that are different from that offered by the existing market players. These offerings should have significant potential to reach broader clientele, particularly the untapped or underserved market segments,” Remolona said.