By
Steve Muchoki
April 23rd, 2024
UnionBank uses its i2i platform to offer the first bank-blockchain transaction in the Philippines connecting islands, individuals, and institutions while offering financial services to the unbanked Filipinos.
In an attempt to realize greater financial inclusion, Philipines’ UnionBank has issued its stablecoin. The payments-focused stablecoin, PHX, is pegged to the Philippine peso as reported by PhilStar Global. According to the report of July 26, PHX is being implemented on UnionBank’s i2i platform.
With that issuance, the bank also carried out the first blockchain-based transaction ever to involve a Filipino bank. The transaction took place on the i2i payment system that connects institutions, islands, and individuals. Philstar reported that three rural banks participated in the inaugural transfer. The PHX stable coin links to the Peso and has the backing of the UnionBank reserves.
According to the UnionBank Senior Vice President, Arvie de Vera:
“PHX is a stable store of value, medium of exchange and is a programmable token with self-executing logic. It enables transparent and automatic execution of payments.”
UnionBank always strives relentlessly to make it easy for the Filipinos to participate in the nascent crypto market. As we published earlier, the bank partnered with Ripple’s xRapid-powered Coins.ph to set up crypto ATMs. These ATMs enable the locals to trade digital assets for Philippine Pesos.
The I2i Platform
I2i is an acronym for institution-to-institution, island-to-island, and individual-to-individual. The name also refers to the blockchain-based clearing system that efficiently connects rural banks in the Philippines to UnionBank.
Philstar Global reported that buy, transfer, and redemption transactions together with domestic remittances have already happened using PHX. The three rural banks participating in the i2i network include Progressive Bank in Visayas, Summit Rural Bank in Luzon, and Cantilan Bank in Mindanao.
De Vera also said that the PHX stablecoin resolves all reconciliation issues and eases any arising compliance and audit challenges. At first, i2i network participants can purchase the currency through direct debit supported by their UnionBank accounts. This stablecoin is also readily redeemable for pesos that can then be credited back to the users’ UnionBank accounts.
Expanding Financial Services Access
Notably, UnionBank introduced this stablecoin to support the Bangko Sentral ng Pilipinas’ advocacy of digital financial inclusion. The advocacy targets to include all individuals and communities in the country. Earlier this July, the bank completed a pilot of a blockchain-based cross-border remittance successfully. The remittance involved the use of the i2i platform and it originated from the Philippines to Singapore.
That initiative used blockchain-based tokenized fiat. It remitted from Singapore’s OCBC Bank to an account holder at a rural Cantilan Bank. The initiative is part of UnionBank’s continuous project to provide financial services to the unbanked Filipinos.