(BusinessWorld) THE BANGKO Sentral ng Pilipinas (BSP) is proposing to initially align the reserve requirements of digital banks with thrift lenders as both are targeting the same market and offer similar financial products.
Under a draft circular released by the BSP, digital banks will generally be subjected to the same standards and prudential requirements imposed on traditional lenders.
One of the key provisions is that digital banks will have to keep a reserve requirement ratio (RRR) of 3%, which is similar to the current level for thrift lenders. In comparison, the RRR of big banks and rural lenders is pegged at 12% and 2%, respectively.
“The policy proposal is to initially align the RRR of digital banks with those of thrift banks, considering the current similarity in their target markets and the type of financial services they offer,” BSP Assistant Governor Lyn I. Javier said in a Viber message.
Ms. Javier said the central bank may adjust the RRR for digital banks “as needed consistent with its price and financial stability objectives.”
Under the draft circular, digital banks will be required to comply with all prudential requirements set by the BSP for the conduct of business. These include requirements for corporate governance, risk management (particularly on information technology and cybersecurity), outsourcing, consumer protection, and anti-money laundering, among others… Read More