UNIONBANK OF THE Philippines, Inc. unveiled the first cryptocurrency automated teller machine (ATM) in the Philippines, allowing customers to exchange digital units for cash.
In a statement on Tuesday, the Aboitiz-led lender said it launched the country’s first bank-operated and two-way virtual currency ATM located in its digital branch “The ARK” in Makati City, making it among the first banks in Asia to do so.
Compliant with the regulations of the Bangko Sentral ng Pilipinas (BSP), UnionBank’s virtual currency ATM allows its account holders with cryptocurrency wallets to withdraw cash straight from their funds as well as buy and sell currencies on the spot.
The lender partnered with financial technology firm Coins.ph to enable the system.
UnionBank Chairman Justo A. Ortiz said the bank put in place the teller machine for cryptocurrencies to meet client demand.
“The reason we’re doing this is because our customers are asking for it,” Mr. Ortiz was quoted as saying in the statement.
“Whenever we launch a new product, customer protection is always our primary concern. And because we want to elevate our customer experience, we envision creating a banking opportunity by co-creating them with our customers.”
Virtual currency is a type of digital money issued, controlled, and used by a certain virtual community.
Cryptocurrencies such as Bitcoin, Etherium and Ripple are virtual currencies that rely on cryptography to secure and verify transactions as well as control the creation of more units. These units are not regulated by any state or central bank.
Such currencies can also be used to pay for goods through the internet and can be treated as an investment given its fluctuating valuations.
Ron Hose, Coins.ph president and founder, said this move of UnionBank is seen as a significant development in the fintech world.
“This is a further testament that banks are now acting like a fintech firm. This launch blurs the line more and we see this move for banks to change the landscape of the world of finance,” he said.
Last month, the central bank issued Memorandum 2019-006 reminding banks that ATMs that offer conversions and withdrawals from cash to digital coins are considered as virtual currency exchanges and must be registered with the regulator.
In 2017, the BSP came out with rules requiring any firm that offers the exchange of money into virtual currencies and vice-versa needs to register with the BSP.
UnionBank President and Chief Executive Officer Edwin R. Bautista said the bank plans to add more virtual currency ATMs in more of its branches, with the approval of the BSP.
UnionBank posted a P7.3-billion net profit in 2018, down 13% from the P8.4 billion income tallied the previous year, dragged by margin pressures due to higher interest rates.
Shares of the bank stood at P61.50 apiece on Thursday, flat from the previous close. — Karl Angelo N. Vidal