The Chairman of the Union Bank of the Philippines claims blockchain could allow rural banks in the nation to offer a wider range of services. Justo Ortiz thinks that the emerging technology could boost lending, as well as increasing efficiency and transparency in the country’s ever-expanding remittance market.
According to a report in Bloomberg, Ortiz is optimistic about how blockchain technology could increase the services offered by the Philippine bank, particularly in rural areas of the nation. The bank has already been experimenting with the technology in relation to the ever-growing remittance market in the Philippines and aims to expand its efforts going forward.
The Philippines’ Remittance Industry
Many families in the country rely on money sent from relatives working overseas to make ends meet. Typically, remittance services are expensive and a lack of transparency in the system gives the worker living in a foreign country little control over who receives money and how it is eventually spent. The Union Bank Chairman stated that the use of a programmable token in the remittance system would allow those sending payments to have more of an impact on how their money is used once it reaches the Philippines. The current inefficiencies in the remittance system also force families to rely on loans from local money-lenders who often levy heavy interest rates on payments. This makes the process of sending money home even more costly, denying vital resources to those who need them most.
