The Philippines’ financial landscape has evolved over the years, bringing a variety of modern tools that have reshaped how people save, spend, and manage their finances. Digital financial services, for instance, have provided Filipinos with a faster and more convenient way to handle everyday transactions. As such, it’s no surprise that they’ve emerged as a transformative force in the country’s banking ecosystem.
While these services have become a part of daily life for many, a large number of consumers aren’t fully aware of how they operate. A lot of people may also not realize the difference between general digital platforms and digital banks that are regulated by the Bangko Sentral ng Pilipinas (BSP), and why that distinction should matter.
To close this gap, this article aims to shed light on the most important facts about BSP-regulated digital banks. Having a better understanding of how these banks are governed should boost your confidence as a user, enabling you to manage your money safely and effectively.
But First… What Does It Mean When a Digital Bank Is BSP-Regulated?
When you’re transacting with a BSP digital bank, it means the institution has been granted a license to operate under the oversight of the Bangko Sentral ng Pilipinas. This regulation ensures that the bank follows strict standards for financial stability, consumer protection, and sound operational practices, reducing the likelihood of serious issues like fraud and data breaches. It also signals that the bank is legitimate, accountable, and required to comply with laws designed to safeguard depositors and the broader financial system.
Now that you know what it means for digital banks to be BSP-regulated, it’s time to explore the key facts that make these worth your attention.
1) They’re Fully Regulated Like Traditional Banks
Even though digital banks are branchless—that is, they have no physical locations—they’re not operating in a regulatory gray area. They go through the same long and rigorous licensing process as traditional banks, which is meant to evaluate their ability to operate safely, fairly, and in the public’s best interest. Moreover, the process is highly selective, as only applicants that demonstrate strong financial backing and a sustainable business model are granted approval.
Once approved, BSP-regulated digital banks are subject to regular audits and reporting obligations, just like any established brick-and-mortar institution. For these banks, operating digitally doesn’t mean cutting corners on accountability or reliability.
2) There are Only a of Handful BSP-Regulated Digital Banks in the Philippines
Since the approval process is strict and time-consuming, only a small number of digital banks have secured a license from the Bangko Sentral ng Pilipinas. As of this article’s writing, there are just six BSP-regulated digital banks operating in the country. One of them is Maya, which is considered to be the Philippines’ number one digital bank.
A main reason the number of BSP-regulated digital banks is low is the fact that the BSP isn’t aiming for quantity. The agency’s priority is quality, as they want to ensure that only well-prepared and well-capitalized players enter the market. As such, not all digital financial services are backed by the BSP. Therefore, it’s in your best interest to verify whether a provider is licensed before entrusting them with your money.
3) BSP-Regulated Digital Banks are Covered by the Philippine Deposit Insurance Corporation (PDIC)
One of the key advantages of banking with a BSP-regulated digital institution is that your deposits are insured by the Philippine Deposit Insurance Corporation (PDIC). This means that in the unlikely event the bank fails, your money—up to PHP 1 million per depositor—is protected by the government.
The PDIC coverage is automatic and does not require any separate application or enrollment, making it a built-in safeguard for your hard-earned savings. Moreover, this level of protection is the same as what’s offered by traditional banks, which should provide peace of mind for first-time users of digital banking.
4) Digital Banks Under the BSP are Required to Maintain Robust Cybersecurity Frameworks
To protect consumers in an increasingly digital financial environment, the Bangko Sentral ng Pilipinas requires all licensed digital banks to implement strong, well-defined cybersecurity frameworks. This includes regular risk assessments, incident response protocols, data encryption, multi-factor authentication, and strict access controls.
These measures are not optional; they’re part of the regulatory requirements that digital banks must meet and continuously update. Failure to comply can result in penalties, sanctions, or even the revocation of a bank’s license. By requiring digital banks to follow international best practices in cybersecurity, the BSP helps ensure that customer information, transactions, and funds are kept secure—even in a constantly evolving threat landscape.
Digital financial services have opened new doors for convenience, accessibility, and financial empowerment in the Philippines. But as more services go online, it’s important to look beyond sleek interfaces and fast transactions. Not all digital financial platforms are regulated, and that distinction can have serious implications for your financial safety. But now that you have a greater understanding of what BSP-regulated digital banks are, you know that these institutions are a safer and more reliable choice in growing your finances.
Business News Philippines was launched in October 2015 as a portal for readers to learn more about operating a business in the Philippines.
