UNO Digital Bank eyes profitability by 2026

UNO Digital Bank, one of the six digital banks accredited in the Philippines, is looking to hit profitability by 2026, four years after it first launched operations, as it targets to grow its loan disbursements by over P20 billion in the next year.

According to UNO president and chief executive officer Manish Bhai, the bank — which commercially launched its application in 2022 — is on track to reach profitability ahead of the global benchmark of seven years for a digital bank.

“If you see globally, it takes a digital bank around seven years to turn profitable. That’s the global benchmark… There are a few exceptions, one or two exceptions when people have it in five years. We wanted to do it in four years for a standalone bank,” he told reporters in Taguig City.

“We will be in our fourth year next year. Of course, our target is to hit breakeven within the first half, and then hit full breakeven with the year. Right now, we seem to be on track with that target,” he said.

The bank has so far disbursed over P8 billion in loans since 2024, P3.3 billion of which was in January to September this year. UNO targets to grow this by over P20 billion to hit over P30 billion in 2026.

The bank currently offers three loan products — its cash loan, its sales finance product, and its tie up products with companies. It is looking to expand its offerings, and increase its touch points in several malls across the country. It is also working on launching a salary loan product by the end of the year.

“Our strategy has been very clear that though we want to get into financial inclusion, we don’t want to start with the bottom of the barrel. Our market is not subprime,” Bhai said.

“We are not talking about the bottom 20 to 30 right now. Eventually, we’ll get to it, but we are talking about the next 30 to 40 million people today who would aspire to have a credit card, who would aspire to have funding but who are today not getting access to that,” he added.

UNO ended September with 4 million customers, 15% of whom recorded it as their first bank, and one out of five of its loan customers are first-time formal borrowers.

“It will still take us five years from here to reach our end goal of making sure that every financial need is covered, including insurance, including investment,” Bhai said. — RSJ, GMA Integrated News