SquidPay eyes digital bank joint venture with AbaCore subsidiary
FINANCIAL TECHNOLOGY player SquidPay Technology, Inc. is looking to form a joint venture firm with Philstar Development Bank, Inc. to enter the country’s digital banking sector.
Squidpay is looking to invest up to P900 million to buy 60% of shares in the Batangas-based Philstar Development Bank to push the planned joint venture, AbaCore Capital Holdings, Inc., said in a filing with the local bourse on Monday. The firm owns Philippine Regional Investment Development Corp., (PRIDE) the parent firm of Philstar Development Bank.
Once the joint venture is created based on the parties’ memorandum of agreement signed in January, the remaining 40% stake in the Batangas lender will be retained by PRIDE and incumbent stockholders.
“The joint venture will target the ever growing need for cashless payments considering the pandemic and the Bangko Sentral ng Pilipinas’ (BSP) drive for digital banking,” AbaCore said in its filing.
SquidPay’s current business mainly focuses on online and offline payment solutions for automated fare collections, bill payment, e-commerce payments, merchant payment services, and electronic loading.
The fintech player has secured its operator of payment system and electronic money issuer licenses from the central bank.
The BSP released a framework for digital banks in November, making it a separate type of lender from commercial, thrift, rural, and Islamic banks. Entities that aim to set up an online bank in the country need to have a minimum capital of P1 billion.
AbaCore’s shares closed trading at P1.22 apiece on Monday, down by four centavos or 3.17%. — L.W.T. Noble