The Bangko Sentral ng Pilipinas (BSP) has awarded digital banking licenses to the country’s first neobanks, Tonik and Unobank, the two entities announced on Monday and Tuesday.
Tonik, a subsidiary of Singapore-based fintech firm Tonik Financial, last month bagged USD 17 million in a pre-Series B round led by iGlobe Partners, bringing its total funding to USD 44 million. Its retail deposits also hit USD 20 million within one month of operation in March, the firm said.
“Securing a digital banking license is one of this year’s anticipated milestones for us,” said founder and CEO Greg Krasnov, adding that it will roll out additional lending and payment products. Philippine investors, including conglomerate Camerton Holdings and Oak Drive Ventures, own 40% of the local subsidiary, which has operated with a rural banking license since December 2019.
Unobank, which is controlled by Singapore-headquartered DigibankASIA, said on Tuesday that it is currently working with cloud banking platform Mambu, banking software firm Backbase, and Amazon Web Services to build out its technology stack.
“Long term, our goal is to bridge the gap to financial inclusion,” said Unobank co-founder Manish Bhai. “We are building the first full-spectrum digital bank to service those with unmet financial needs in Southeast and South Asia.”
According to the 2019 Financial Inclusion Survey conducted by the Philippine central bank, 71% of the country’s 72 million adult population remain unbanked. This group represents young people with a median age of 24 that are underserved by the current banking system.
Overseas Filipino Bank, or OFBank, which is controlled by the state-owned Land Bank of the Philippines, was the first institution to be awarded a digital license in March. BSP governor Benjamin E. Diokno told local publication Manila Bulletin in April that the regulator will “release five digital bank licenses” but might increase that limit depending on the demand and requirements.
South African digital lender TymeBank, which has just secured USD 110 million in a Series B funding round, is also eyeing a license in the country. The firm has partnered with local conglomerate JG Summit and is currently in the process of applying for a digital license from the BSP.