State-Owned OFBank Clinches Philippines’ First Digital Banking Licenseby Fintech News Philippines April 5, 2021
Overseas Filipino Bank (OFBank), a wholly owned subsidiary of the Land Bank of the Philippines (LANDBANK), has digital only bank to secure a license under Bangko Sentral ng Pilipinas (BSP)’s newly revised digital banking framework.
OFBank was issued a digital banking license on March 25 after being approved for the first phase of BSP’s three-stage licensing framework on the establishment of new digital banks. OFBank’s license differs from other digital-only banks or neobanks who are operating under a rural banking license which adhere to a different set of rules.
Following that, OFBank was able to commence its banking operations in June last year using its then existing license to operate as a thrift bank while fine-tuning its operations to enable its official transition into a digital bank.
In December 2020, the BSP issued Circular No. 1105 on The Guidelines on the Establishment of Digital Banks, clearing the way for the OFBank to apply for a license as a digital bank.
The OFBank’s global digital reach reportedly spans 112 countries, with its clients able to access online the services of 763 merchants onboarded in its mobile application via the LinkBiz.Portal.
Finance Secretary Carlos Dominguez III said,
“This milestone in the country’s banking history not only fulfills President Duterte’s campaign pledge to create a bank that caters to overseas Filipinos, but will also help the Philippines leapfrog to the digital economy.
I commend the OFBank and the LANDBANK under its President-CEO Cecilia Borromeo for their tireless efforts that have led to the bank’s transformation into the Philippines first branchless and digital-only banking institution,”
The Philippine Postal Savings Bank (PPSB) was acquired by LANDBANK and converted into the OFBank.