UnionBank of the Philippines has secured a Virtual Asset Service Provider (VASP) license, allowing it to offer a range of related services to its customers.
UnionBank obtained the license from the Bangko Sentral ng Pilipinas (BSP) after months of intense scrutiny from the banking regulator, according to a Manila Times report. The issuance makes UnionBank the first universal bank in the Philippines to offer its customers digital asset services.
UnionBank Senior Vice President Cathy Casas said the license will give customers the functionalities of buying and selling digital assets via the bank’s mobile app. However, details over custody and the type of digital assets to be offered remain sparse, but it is likely the offering will be available for large-cap assets like BTC and Ethereum (ETH).
The bank also holds a limited license that allowed randomly selected users to trade digital assets via the bank’s mobile application. Following the BSP’s decision to confer a full VASP license on the bank, Casas stated that the in-app trading of digital assets for all customers will be rolled out before the end of 2023.
The VASP license underscores its digital ambitions and is a nod to the firm’s desire to offer users new mediums of interacting with the bank, bracing itself for the future of finance, according to the bank.
“Our pursuit of this license isn’t just about staying current, but about being future-proof and future-ready,” said Casas. “The financial landscape is evolving at an unprecedented pace, and we want to be at the forefront, ensuring that we are equipped to meet the evolving needs of our clients.”
UnionBank has been dabbling in emerging technologies like blockchain technology, which it says will be vital in providing financial services to marginalized Filipinos. Currently, the bank is exploring the use of blockchain-based digital IDs to provide banking and credit services to unbanked residents.
“There are plans in our roadmap to have a crypto exchange at UnionDigital,” said Mike Singh, the Chief Commercial Officer for UnionDigital. “We’re all smart contract-based. We have digital identities, which is another product we’re developing.”
The bank’s digital arm is also mulling a slew of offerings for the country’s growing play-to-earn communities and another to allow users to pay in digital assets with merchants automatically receiving fiat.
BSP still views digital currencies with suspicion
Despite the massive adoption levels of digital assets in the Philippines, the country’s central bank continues to eye the asset class with a measure of skepticism. BSP Governor Felipe Medalla described digital currencies as risky assets, citing their volatility and industry collapses as a reason for investors to be wary.
“I have already said many times in the past that crypto assets are very risky and those who invest are advised to invest only what they can afford to lose,’ said Medalla.
To assess the best ways to approach regulation, the central bank imposed a moratorium on VASP license applications for three years back in 2022. However, only new applications were affected by the temporary ban, with the regulator confirming that it will continue to process applications that have reached advanced stages.
Watch: UnionBank of the Philippines remains relevant with the help of blockchain tech, Cathy Casas tells CoinGeek Backstage
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