Fintech, blockchain, open finance expertise to help UnionDigital usher future of banking in PH

With its expertise in fintech, blockchain, and open finance in the country, UnionDigital is well-positioned to offer financial services to customers regardless of how digital finance would evolve. This was the key message of UnionDigital CEO and co-founder Arvie De Vera during his presentation at the BusinessWorld Insights Forum. The topic for the day was on digital banks and the transformation of the financial sector in the country.

“When we started this digital transformation journey, our aspiration was to adopt the mindset and agility of a tech company, but retain the governance and trust of a regulated bank. That aspiration became a reality on December 2020 when the Bangko Sentral ng Pilipinas (BSP) released its digital bank regulations. Six months later, UnionDigital was born, and operates as a tech company and also a bank,” De Vera said.

Preparing for the future of banking, UnionBank knew that it had to digitize to stay relevant. For such a complicated task, the Bank thought of three approaches. The first was to digitally transform UnionBank; another is to have UBX, its fintech arm; and last but not least is to launch UnionDigital, a digital-native bank.

According to De Vera, “All of these approaches were developed to ensure that we will be well-positioned to offer financial services to our customers regardless of how digital finance would evolve, and those possibilities were accelerated by these key trends that are now driving exponential growth.”

De Vera mentioned a few trends that he says will continue to shape the future of banking moving forward. First is the enormous growth of fintech in the country. Open finance has been a priority of the BSP and the Monetary Authority of Singapore to drive more interoperability in transactions, and that opens the floodgates to more digitally enabled transactions.

In addition, he said that the Philippines is primed for digital and Web 3.0 exponential growth, while being the fourth fastest growing digital economy in the world. The country has over 20 percent digital transactions in 2020 from 1 percent in 2013, has 4.36 million Filipinos who own cryptocurrencies, and is the first in the world in NFT [non-fungible token] ownership. The play-to-earn phenomena, particularly, has exploded in popularity. For example, on Axie Infinity, 40 percent of the users are Filipinos.

“UnionBank is the only publicly listed bank to be granted a digital license by the BSP. That means we have the pedigree, the history, the experience, and the strength of a universal bank parent, capable of bridging the regulatory gap between the technologies of today and tomorrow. We are best positioned because of our trailblazing leadership in fintech, blockchain, and open finance.”

“UnionDigital will harness these three key themes to deliver superior customer experience. UnionDigital, as a fintech and also a bank, will provide our customers with the best that both these worlds have to offer. And lastly, we'll always be passionate about customer centricity and will tap UnionBank's natural ecosystems where we can unleash UnionDigital and help 'tech-up' the Philippines,” De Vera concluded.