The digital banking industry in the Philippines has seen a notable increase in investment, with more than $700 million invested in the sector since 2021. This growing industry not only reflects a move towards contemporary financial solutions but also indicates a promising economic landscape that may offer potential benefits for real estate investors seeking to take advantage of the expanding market.
Investments in digital banking are experiencing an unprecedented level of growth
In recent years, Philippine banks have attracted significant investments amounting to over $700 million. This financial support serves as a testament to the investors’ trust in the sector’s potential for growth. According to Angelo Madrid, President of DiBA PH and Maya Bank, this investment represents a “strong vote of confidence” in the industry’s ability to drive economic development, generate employment opportunities, and enhance access to financial services. For real estate investors, this reflects a thriving economic ecosystem that offers promising investment prospects.
Rapid expansion in banking services and user base
The digital banking sector has shown impressive growth metrics. By the end of 2023, the number of digital bank depositors is expected to reach 5.9 million, with total deposits almost doubling from ₱ 350 billion ($6.3 billion) in 2022 to ₱ 690 billion ($12.42 billion). Similarly, the total loan portfolio is expected to more than double to nearly ₱ 250 billion ($4.5 billion). Digital banks are now at the forefront of providing “meaningful, tech-empowered, and personalized financial services.” This is especially beneficial for communities that have been traditionally underserved. This expansion is not just a boon for the banking industry but also contributes to broader economic engagement and financial inclusion. These factors can ultimately lead to a stable and growing real estate market.
Strategic initiatives propel market confidence
The commitment of digital banks to enhancing the financial infrastructure of the Philippines is admirable, despite challenges such as the slow rollout of the national ID system and limited coverage of the national credit bureau. UnionDigital Bank’s President, Henry Aguda, recognizes the sector’s potential to “drive economic inclusivity and innovation,” setting new benchmarks for banking in the Philippines. Moreover, all six BSP-licensed digital banks, including GoTyme Bank and UnionDigital Bank, have credible investors who are committed to fostering long-term growth in the market.
Foreign real estate investors may find the thriving digital banking sector in the Philippines as a promising investment opportunity. The country’s financially empowered population and rapidly evolving economy make it an increasingly attractive market. The growth of the digital banking sector also signals economic stability and potential for real estate expansion. This makes it a good time for interested investors to explore Philippine real estate investment opportunities.
