Union Bank of the Philippines (UnionBank), a trailblazer in banking innovation, has achieved another industry first by securing a Certificate of Authority from the Bangko Sentral ng Pilipinas (BSP) to operate as a virtual asset service provider (VASP). This notable accomplishment positions UnionBank as the exclusive universal bank in the Philippines licensed to provide virtual asset exchange services. The momentous occasion was commemorated during the formal license presentation to UnionBankers on September 27 at UnionBank Plaza in Pasig City.
The VASP license empowers UnionBank to explore novel markets and opportunities, address evolving client needs, and maintain a leading position in technological advancements within the digital financial landscape. Aligned with its dedication to innovation, regulatory compliance, and customer-centricity, this license propels the bank into a future-ready state, prepared to serve and lead in a continually evolving financial environment.
UnionBank’s strategic adoption of blockchain technology plays a pivotal role in its future-proofing strategy. Actively exploring potential use cases, including cryptocurrencies, the bank introduced the Philippines’ first bank-operated, two-way virtual currency ATM in 2019 at its digital branch “The ARK” in Makati City, facilitating cryptocurrency transactions.
Drawing insights from the virtual asset ecosystem, UnionBank is positioned to discover additional applications for blockchain technology, extending beyond virtual assets. This includes exploring possibilities such as tokenized collaterals, tokenized deposits, and implementing tokenization in trade finance and supply chain financing. The transformative potential of blockchain technology in customary banking processes is envisioned to enhance efficiency, transparency, and accessibility.
UnionDigital Bank President and CEO Henry Aguda emphasized the pioneering efforts of the Emerging Technology team, stating, “Strategically, this will pay off in the next coming years, especially when a lot of investors are going into blockchain and tokenization.”
Senior Vice President and Head of Emerging Technology Group Cathy Casas expressed the bank’s readiness to break molds and set trends with the new license. She emphasized that innovation involves pushing boundaries, venturing into the unknown, and courageously stepping into unexplored territories.
The VASP license not only strengthens UnionBank’s focus on customer-centricity but also enhances its ability to provide innovative solutions that contribute to clients’ overall financial well-being. The expanded offerings through the license enable the bank to deliver more comprehensive financial experiences, covering a broader range of blockchain-powered services, including lending, cross-border payments, and other smart contract-based financial products.
UnionBank Vice Chairman Dr. Justo A. Ortiz stressed the importance of remaining focused on the target amid challenges, emphasizing the bank’s commitment to elevating lives and fulfilling dreams.
The VASP license positions UnionBank as a responsible player in the digital finance ecosystem, particularly in terms of surveillance and compliance. The bank’s focus on surveillance goes beyond regulatory requirements, reflecting its commitment to maintaining client trust and ensuring the legitimacy of virtual assets while preventing illicit activities.
UnionBank’s dedication to complying with regulatory standards and proactive collaboration with the BSP to shape the future of digital finance in the Philippines sets an example for the industry to emulate, according to Executive Vice President and Chief Technology and Operations Officer Dennis Omila.
Through this milestone, UnionBank establishes new standards, redefines the role of a bank in the digital age, and fosters collaborations and partnerships that drive progress for a brighter future. The initiative aligns with the bank’s “Tech-Up Pilipinas” advocacy, aimed at advancing digital literacy, enhancing financial inclusion, and promoting technological empowerment among Filipinos.
