Philippines Eyes Cap on Digital Bank Licenses Amid Policy Review

(Bloomberg) -- The Philippine central bank may set a limit on the number of digital lenders in the nation, as it seeks to release regulations on the emerging industry before the year ends.

Under a planned policy that’s under review, online banks must adhere to the same corporate and risk management standards as traditional lenders, Bangko Sentral ng Pilipinas Governor Benjamin Diokno said in a virtual briefing Thursday.

The monetary authority has had talks with domestic and foreign companies seeking to establish a fully virtual bank in the country, Diokno said. It will formally accept applications once rules are out and “reserves the right to set a limit on the number of digital bank entrants,” he said.

Central banks across Southeast Asia are establishing rules on virtual lenders as companies from Grab Holdings Inc. to AMTD Group Co. see the region’s potential in the financial technology space. Singapore is planning to award as many as five digital licenses to non-banks later this year.

Diokno also said:

• Bangko Sentral will keep active oversight of digital tokens after virtual currency transactions hit 59 billion pesos ($1.2 billion) in the first half. That’s almost three times as much as 2019’s total value.
• Monetary authorities have completed the disqualification from the financial industry of former bankers who allegedly falsified documents for Wirecard AG.
• The central bank is committed to strictly implementing a debt payment relief program and encourages consumers to report erring lenders.

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