1 month ago
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The Bangko Sentral ng Pilipinas (BSP) expects a major Malaysian player to enter the Philippines' Islamic digital banking sector, according to a senior central bank official.
“We’re also expecting of course the entry of a major player, apart from Maybank, because Maybank already has an existing presence here in the Philippines,” said Chuchi G. Fonacier, BSP deputy governor for the financial supervision sector.
Fonacier said that during BSP roadshows in Indonesia and Malaysia, the Philippine government "enticed a major player in Islamic banking to establish a presence" in the local market.
While details were not disclosed, the deputy governor told reporters during a two-day media information session in Baguio City that there is strong interest from the Malaysian banking community.
“So that’s what we’re hoping for—a major player. In fact, one is considering something along the lines of: ‘Now that we have reopened digital banking, maybe they would like to consider a digital Islamic bank,’” she said.
Asked about the central bank's objective for the Islamic banking sector, Fonacier clarified that the focus is not solely on size, but rather on increasing the number of participants.
“Right now, there are only three, so it might be good to initially increase that to around six or seven. With more players, there would be greater competition, and they could also serve different areas, especially in the Mindanao region,” Fonacier said. This target number of players is expected to materialize within five years.
Currently, three Islamic banking players operate in the Philippine market: CARD Bank, Maybank, and Amanah Islamic Bank, most of which operate in Mindanao.
BSP data showed that the Bangsamoro Autonomous Region in Muslim Mindanao (BARMM) is the most unbanked region nationwide, with 109 of its 127 (86 percent) municipalities and cities remaining unbanked.
