July 25, 2019 – UnionBank of the Philippines recently piloted a blockchain-based remittance from Singapore to the Philippines.
The test was done on June 27 by remitting money from OCBC bank in Singapore to Cantilan Bank in Surigao. Cantillan Bank is a rural bank and a participant in UnionBank’s UBX’s i2i platform, a blockchain network connecting rural banks in the Philippines via blockchain.
“With the pilot’s use of i2i, rural banks can now receive direct-to-account remittance, and this is only the beginning. With this connected platform, other value-added services can now be made accessible to rural banks,” said Arvie de Vera, UnionBank Senior Vice President and Head of the Fintech Business Group.
Rural banks in the Philippines have limited access to financial networks and it takes 5 – 7 days for accounts to be credited. This makes non-bank remittance counters more attractive in areas served by the rural bank.
According to UnionBank’s press release, customers will see significant cost savings and “near real-time” transfer, which is advantageous versus the current 5 – 7 days that it takes for money to be transferred.
“This is because blockchain’s advantage lies in it being a distributed ledger where transaction records are accurate, immutable and transparent allowing for atomic verification and subsequently, atomic settlements.”
UnionBank’s i2i is now managed by UBX, the bank’s fintech subsidiary. The remittance is made possible through PHX, UnionBank-backed tokenized fiat (stablecoin) which will launch soon in the Philippines.
The three parties involved in this blockchain remittance test is UnionBank, OCBC Bank in Singapore and Adhara liquidity management and international payments platform. UnionBank and OCBC will publicly demo this test at the Singapore Fintech Festival in November this year.
Cantilan Bank, the rural bank that received the remittance from this blockchain pilot, gave a talk last year at the Blockchain Applications and Economics Forum on how Project i2i can help rural banks such as Cantilan Bank make bank-to-bank transfers in just five minutes and with one to two employees. It certainly boosts the speed of transactions that formerly takes “26 processes, 5 departments, 5 employees, and sometimes almost a month of waiting.”
This article is first published on BitPinas: UnionBank Pilots Blockchain-based Remittance from SG to PH