PayMaya gets country’s sixth digital banking license

VOYAGER INNOVATIONS, Inc., through its fintech arm PayMaya Philippines, has secured central bank approval to operate a digital bank, which it said will focus on the unbanked and underserved, as well as small businesses.

The Bangko Sentral ng Pilipinas (BSP) granted the country’s sixth digital bank license to PayMaya, Voyager and PayMaya said in a statement on Monday. The new lender will be called Maya Bank.

“With the digital banking license, Maya Bank’s primary focus will be the largely unbanked and underserved population of consumers and micro-, small-, and medium-sized enterprises (MSMEs). It also intends to promote digital financial services among the youth, women, senior citizens, and other underbanked segments,” the firms said.

“It also intends to promote digital financial services among the youth, women, senior citizens, and other underbanked segments,” they added.

Voyager in June raised $167 million from a funding round, which it said will be used for the expansion of PayMaya and the establishment of a digital bank.

“Maya Bank will provide mobile-first digital banking services on the back of PayMaya’s widely trusted e-wallet and proven technology platforms. It will maximize PayMaya’s extensive Smart Padala agent network and leading merchant payments processing business to serve more customers and grow the digital financial ecosystem,” the companies said.

“Our digital bank license underpins the unique value of our end-to-end financial services ecosystem as it unlocks opportunities beyond payments. We are truly honored by the trust placed on us by the BSP for our digital banking endeavor,” Voyager and PayMaya Chief Executive Officer and Founder Orlando B. Vea was quoted as saying.

Maya Bank’s key advantage lies in the already established payment ecosystem of its parent company PLDT, Inc., as well as having large private equity firms such as Tencent Holdings and KKR & Co. as its funding backers, said Tamma Febrian, Associate Director, Banks – APAC, Fitch Ratings.

“We expect Maya Bank to be able to grow its deposit base and/or lending businesses probably quicker than the few other smaller digital upstarts over the next few years,” Mr. Febrian said in an e-mail.

He said Maya Bank’s addition to the country’s digital banking space will improve competition and spur lenders to innovate and digitize.

“We believe that the primary customers of many of the new digital banks will be those that are currently underserved by the banks, suggesting that direct competition will likely be more moderate — at least in the initial few years,” he said.

Maya Bank will join five others that earlier secured digital banking licenses from the BSP, namely the state-owned Overseas Filipino Bank, Tonik Digital Bank, Inc. (Philippines), UNObank, Aboitiz-led Union Digital Bank, and GOtyme, which is owned by the Gokongwei Group and Singapore fintech firm Tyme.

The central bank in August decided to raise its cap on digital bank licenses to seven from five previously. The window for applications closed on Aug. 31, with BSP Governor Benjamin E. Diokno saying they are unlikely to issue licenses in the next three years to monitor current players and ensure healthy competition.

Digital banks are not required to have physical branches and their services are offered via online platforms. These lenders are expected to help the BSP reach its goal to bring 70% of Filipinos into the formal banking system and have 50% of transactions done online by 2023.

Voyager is the digital arm of PLDT. Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has a majority stake in BusinessWorld through the Philippine Star Group, which it controls.