UnionBank becomes BSP-authorized Virtual Asset Service Provider
Union Bank of the Philippines (UnionBank) recently secured a Certificate of Authority from the Bangko Sentral ng Pilipinas (BSP) to operate as a Virtual Asset Service provider (VASP). This makes UnionBank the first and only universal bank in the Philippines licensed to offer virtual asset exchange services.
With the VASP license, UnionBank will be able to tap into new markets and opportunities, explore new ways of addressing evolving client needs like never before, and remain at the forefront of technological advancements ensuring its competitiveness in the digital financial space. Together with its commitment to innovation, regulatory compliance, and customer-centricity, the license enables the Bank to become more future-ready, ready to serve and lead in an evolving financial landscape.
The adoption of blockchain technology has been integral to UnionBank’s future-proofing strategy, and the Bank has been actively exploring potential use cases, including cryptocurrencies, to adapt to evolving customer needs and financial trends. In 2019, the Bank launched the country’s first bank-operated, two-way virtual currency ATM located in its digital branch “The ARK” in Makati City, which allows users to buy and sell cryptocurrencies.
Drawing upon the insights gained from the virtual asset ecosystem, the Bank can discover additional applications for blockchain technology that extend beyond virtual assets. Through exploring various possibilities such as tokenized collaterals, tokenized deposits, and the implementation of tokenization in trade finance and supply chain financing, blockchain technology has the potential to revolutionize customary banking processes, thereby bolstering efficiency, transparency, and accessibility.
The license will also help strengthen the Bank’s focus on customer-centricity, especially its ability to provide innovative solutions that enhance its clients’ overall financial well-being. In addition, the Bank’s expanded offerings through the license can provide clients with more comprehensive financial experiences, covering a broader range of financial services powered by blockchain, such as lending, cross-border payments, and other smart contract-based financial products.
The VASP license positions the Bank as a responsible player in the digital finance ecosystem, particularly in terms of surveillance and compliance. UnionBank’s focus on surveillance is not merely a regulatory requirement but a commitment to maintaining the trust of clients and of the industry as robust surveillance mechanisms help ensure the legitimacy of virtual assets and prevent illicit activities. The Bank’s dedication to complying with regulatory standards and working proactively with the BSP to shape the future of digital finance in the Philippines can serve as an example for others to emulate.
Through the milestone, UnionBank sets new standards and redefines what it means to be a bank in the digital age through collaborations and partnerships that define progress for a brighter future. The initiative aligns with the Bank’s “Tech-Up Pilipinas” advocacy, aimed at advancing digital literacy among Filipinos and enhancing financial inclusion and technological empowerment in the country.
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