In a major step by the Philippines Bureau of Treasury (BTr), they have announced their partnership with the Union Bank of the Philippines and also the Philippine Digital Asset Exchange or PDAX to launch a new app known as Bonds. This new app will be a decentralized ledger technology platform allowing the government to distribute retail treasury bonds. Using the platform, the investors will be able to purchase retail treasury bonds for a minimum of 5,000 Philippine pesos or approximately $100. They will accept payments through multiple options such as online banking, e-wallets, and over-the-counter. The treasury will issue bonds worth 192.7 billion Philippine pesos ($3.9 billion) through the app in the coming months.
After the announcement, Rosalia V. De Leon, the Philippine National Treasurer, issued a statement stating that the new app Bonds will provide an opportunity to Filipinos to invest in new and the latest retail treasury bonds such as RTB-24 and the Progreso Bonds. She further added that the app would increase investment opportunities and allow the Republic to aid in their response to COVID-19 and help in economic recovery. The new platform will document the transactions in DLT infrastructure along with the legacy centralized system. Edwin R. Bautista, the CEO and the UnionBank President claimed that this is one of the first such DLT-based systems for retail Treasury bond distribution in Asia and around the world. He claimed that the Philippines were ready to use innovation and technology to enhance opportunities and benefit its people.
According to a recent survey, about 77% of Philippines adults still do not have a bank account. Thus, the new platform is designed to allow such residents to invest their money without a bank account. Thus, Bonds form an important platform to bring investment opportunities to the unbanked population in the Philippines. The new app will run on technology allowing the Bureau of Treasury to reduce costs and the time necessary for manual verification and settlement. The Bureau expects the platform to make the bond distribution process easy and economically viable for all parties involved. Even though the app might be targeting unbanked Filipinos, the drive will also help raise the much-needed fund for the government.
Bonds – the new bond issuance platform, is receiving the support of national and international regulators such as the Philippine Securities and Exchange Commission, the Singaporean market regulator, and many other fintech and blockchain establishments. The spokesperson for MAS, Sopnendu Mohanty, said that Singapore’s blockchain community would be happy to work alongside Philippines and share open-source resources, learning and help connect nodes to integrate the ensure market infrastructure to bring in transparency. UnionBank also launched Stablecoin last July to help increase financial inclusion in the Philippines. The COVID-19 pandemic has led to an increased usage of banks’ digital services, and it could easily lead to the end of cash in the coming years.