Money & Power
Bangko Sentral Grants the Country's First E-Money License to a Bitcoin Startup
Policy turnaround reflects regulators view that virtual currencies can boost financial inclusion
IMAGE WIKIMEDIA COMMONS
Comments

Bitcoin-enabled fintech platform Coins.ph announced it has been granted an Electronic Money Issuer (EMI) license by the Bangko Sentral ng Pilipinas (BSP), making it the first blockchain startup in Asia to win such a license from monetary regulators, it said in a statement issued Nov. 17.

“The new license allows Coins to accept and hold customer funds, and extend the functionality of its online and offline payment services,” it explained. “The company already has a very active customer base using its existing payments, remittance, air-time and bill-pay services.”

The move represents a sharp policy turnaround for the Philippine banking regulator. Many central banks are wary of Bitcoin and other cryptocurrencies because these were not created by monetary authorities, and the BSP is no exception. In 2014, it issued a circular warning the public how exchanges using cryptocurrencies are unregulated and “may be used for money laundering and other illicit activities.”

The BSP started to soften its cautious attitude towards Bitcoin and other digital currencies early this year when it issued Circular No. 944, which recognized their benefits for easing payments and money transfers. It outlined broad regulations for businesses that want to operate as virtual currency exchanges.

The BSP has long been issuing EMI licenses to banks and other financial institutions subject to its regulatory authority. It also granted EMI licenses to fintech platforms linked to telecommunications operators such as G-Xchange Inc. and PayMaya as well as to payments systems such as Alipay, Infoserve, and TrueMoney.

The EMI license issued to Coins.ph is the first to be granted to a Bitcoin-enabled fintech platform. It is expected to boost customer trust as they can use the platform not just for payments or remittances but also to store funds.

“This license reflects our ongoing commitment to ensure Coins’ customers can store their funds in a safe and secure e-wallet that they can trust,” Coins CEO Ron Hose said in a statement. 

ADVERTISEMENT - CONTINUE READING BELOW

The central bank issued guidelines on the issuance of electronic money way back in February 2009. The guidelines, outlined in Circular No. 649, defined e-money as any monetary value represented by a claim on its issuer that meets the following requirements: a) electronically stored in an instrument or device; b) issued against a receipt of fund of an amount not lesser than the monetary value issue; c) accepted as means of payment by persons or entities other than the issuer; d) withdrawable in cash or cash equivalent; and e) issued in accordance with BSP regulations. The electronic instruments or devices refer to cash cards, e-wallets accessible via mobile phones or other similar devices, stored value cards and other similar products.

As electronic money, funds stored with EMI license holders are not considered deposits and do not earn interest. Neither are they covered by deposit insurance. The BSP has also set a monthly aggregate load limit of Php100,000 per account holder being served by each EMI.

Founded in 2014, Coins gives its users access to a wide array of financial services like remittances, bill payments, and online shopping through a mobile application. Like most fintech startups, its users would have to set up an e-money account, which may be loaded up in different accessible payment centers like convenience stores, pawn shops, and even banks.

But what makes it stand out from the rest is all of its services are powered by Bitcoin, making it one of the first startups in Southeast Asia to use blockchain technology. The startup now has over two million users and has since expanded to Thailand.

“Coins wants to make financial services easily accessible to anyone, anywhere, via their mobile phone. Receiving this license is an important milestone towards extending the ecosystem of services available to our customers,” Coins Head of Business Operations Justin Leow said in a statement.

ADVERTISEMENT - CONTINUE READING BELOW

Coins has received fresh funding worth $9.5 million from investment firms Quona Capital and Naspers Ventures in the first half of the year. According to a study by global consulting firm Accenture, investment in fintech players in the Asia Pacific region has risen from $103 million in 2010 to $4.3 billion in 2015.

*****

Elyssa Christine Lopez and Lorenzo Kyle Subido are staff writers of Entrepreneur.com.ph.

*This story originally appeared on Entrepreneur.com.ph
*Minor edits have been made by the Townandcountry.ph editors

Comments
About The Author
Lorenzo Kyle Subido
View Other Articles From Lorenzo Kyle Subido
About The Author
Elyssa Christine Lopez for Entrepreneur.com.ph
View Other Articles From Elyssa Christine Lopez for Entrepreneur.com.ph
Comments
Latest Stories
 
Share
Rikkie Dee's Foodee Global Concepts balances homegrown restaurant concepts with award-winning global brands.
 
Share
 
Share
Journey from Boston to Nantucket to discover the quintessential playground of the American East.
 
Share
Despite their high-profile family backgrounds, these bachelors have chosen to remain humble and under the radar.
 
Share
They're bringing in a whole new slate of actors for season 3.
 
Share
A bi-monthly look at what's to come for your sign courtesy of T&C's master astrologer, Katharine Merlin.
 
Share
Solaire will be flying in 25,000 liters of beer from Bavarian brewery Weihenstephaner, said to be the world’s oldest.
 
Share
She'll marry Jack Brooksbank at Windsor Castle on October 12.
 
Share
No visit to Athens is complete without a stop at the jeweler that launched T&C U.S. editor-in-chief Stellene Volandes's obsession with jewelry.
Load More Articles
CONNECT WITH US