MANILA — Digital banks can help cut remittance fees paid by overseas Filipino workers (OFWs), which can reach as high as 16 percent, UnionDigital Bank President and CEO Henry Aguda said on Monday.

UnionDigital recently made its services available in Israel to help Filipinos send their money home with less fees.

Aguda said the goal is to make remittance fees cheaper in every corner of the globe where there are Filipinos.

"Digital banks will be able to cut the friction cost and just do account-to-account transfers. That’s what we’ve been working on, not just in Israel," he said.

"The remittance space is huge and the market that it's servicing, the OFWs, really require better pricing in that area," he added.

Aguda said the digital bank's main bread and butter remains to be lending, and this segment would help them offer more competitive remittance rates.

Digital banks are banks without physical branches wherein all transactions are done electronically. Aside from cheaper remittance rates, most digital banks also offer higher interest rates on savings accounts compared to universal and commercial banks.

UnionDigital is among the 6 digital banks granted with a license to operate by the Bangko Sentral ng Pilipinas.

• UnionDigital says $70M loan book, $50M deposits reached in just 4 months
• UnionBank says digital subsidiary UnionDigital has started operations
• BSP approves UnionBank application to create digital bank

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