Netbank, a Philippine-based banking-as-a-service platform, announced that it has raised funds in its Series A round, which was anchored by Singapore-based venture capital investor BEENEXT.
The company did not disclose the amount it raised in the round but said early-stage investment firm Kaya Founders and boutique investment company Oak Drive Ventures, both based in the Philippines, participated, along with individual angel investors.
Netbank, which has a rural bank license in the Philippines, provides various banking solutions like alternative lenders, payment solutions, neobanks, and wallets.
The company said it will use the fresh funds to expand its product suite with enhanced payments, accounts, and lending solutions for its client base. Netbank currently serves lenders, e-commerce platforms, payment companies, and corporations.
“We give fintechs a total toolkit, so they can focus on their clients and their growth,” the company said on its website.
Launched in 2021 by Gus Poston, Netbank is a fully regulated bank that has built the infrastructure needed to provide a full range of banking services, becoming the first banking-as-a-service platform in Southeast Asia.
Netbank said that it has seen its assets grow by 1,600% since the start of 2022, to reach PHP1 billion ($18 million). The firm claims to have reached profitability in March 2023.
“With this capital infusion, we are strongly capitalized and ready to expand our lending to more segments of the Filipino new economy,” Poston said.
Digital banking is rapidly transforming the financial landscape in the Philippines, driven by technological advancements, government policies, and changing consumer behavior.
The rise of digital banking in the country signifies a remarkable shift in the way Filipinos are accessing and managing their finances.
The Bangko Sentral ng Pilipinas (BSP), the country’s central bank, has been supportive of this transformation, implementing regulations that foster innovation and competition within the banking sector.
The BSP has set a goal to have at least 70% of Filipinos have a bank account and to make 50% of total retail transactions electronic by 2023 under its National Retail Payments System (NRPS) and Digital Payments Transformation Roadmap.
Recently, there has been a big rush for digital banking licenses in the Philippines, drawn by the country’s 45 million underbanked adult population.
The first bank to obtain the license was Overseas Filipino Bank, a subsidiary of the state-owned Land Bank of the Philippines.
The others that have secured digital banking licenses are Tonik Digital Bank Inc (Philippines), whose holding company is Singapore-based Tonik Financial Pte Ltd; UNObank, which is backed by Singapore-based fintech company DigibankASIA Pte Ltd; and Aboitiz-led Union Digital Bank.