5 Digital Banks in The Philippines with High-Interest Rates

Do you want to open a savings account online without the need to go to the physical branch? Well, this article has you covered with this list of 5 digital banks that offer a savings account opening just by using your mobile phone or a desktop computer and a stable internet connection.

Before I give you the list, let us answer some of the frequently asked questions about digital banking.

What is a Digital Bank?

A Digital bank, according to Wikipedia, represents the virtual process that includes online banking and beyond. It only means that with a digital bank, you can do all of your banking activities online, doing away with all the hassles such as waiting in line for hours in a bank branch.

Pros and Cons of Using Digital Banks

There are some advantages and disadvantages of using digital banks, which you should know before deciding on creating an account with any of these digital banks.

Benefits of Digital Banks

1. Convenience and Accessibility

With the threats of the coronavirus, it is safer and more convenient to make all banking transactions online from the comfort of your home, which these digital banks offer.

Moreover, you can access your accounts anytime and anywhere using your smartphone or laptop with an internet connection. With this, you can detect any unauthorized transactions on your account and you can report them immediately to the bank.

2. Fast and Easy Banking Transactions

Since almost all transactions, from opening an account to spending your funds, can be done over the internet, you can save a lot of time and effort compared to over-the-counter banking activities.

3. Ability to Pay Bills and Fund Transfer

Another thing I want to add here is the ability to pay for your bills, buy load, and transfer funds using these digital banks. What’s even better is that most of these added features are free of charge and sometimes, they offer discounts and rewards.

4. Offer Higher Interest Rates

I think this is the main reason why people prefer opening a savings account on digital banks than with traditional banks. There’s usually 2-4% more annual interest rates digital banks offer than what regular banks do.

Disadvantages of Digital Banks

1. Service Interruptions

Since all transactions are completed online, the ease of use of these digital banks greatly depends on your internet connection and how fast your gadget is. 

Furthermore, if the bank has scheduled site maintenance or if the server is down, you won’t be able to access and use the banking facilities.

2. Identity Theft Concerns

Although digital banks continuously update their security systems, they are still prone to hacks, identity theft, and other unauthorized transactions. With this, you should always be aware of what’s happening on your account.

Top Digital Banks in the Philippines

Now, have you decided that digital banking is for you? Then here are the 5 digital banks in the Philippines that you can open an account with.

All these digital banks offer bills payment, buying load, cash in, and cash-out features, which can all be completed using their mobile apps unless stated otherwise.

Also, I’ll be creating separate posts for an in-depth review of each of these digital banks. Stay-tuned.

ING Philippines

ING Philippines is said to be the very first digital bank that was introduced here in the Philippines. This digital bank is headquartered in Amsterdam and is operating in more than 40 countries around Asia, Europe, and the Americas.

According to their website, they’ve been operating here in the Philippines since 1990 and they were the first foreign bank to become a universal bank.

Here are 5 reasons why I like ING Philippines:

1. This digital bank offers an interest rate of 2.5% per annum but currently they have an introductory promo for new clients (until September 30, 2021) to have a 4% p.a. Interest rate for the first 4 months after opening an account with them.
   Note: The interest rates are subject to a 20% withholding tax.

2. ING Philippines offers free visa card. You just have to request using their app.
3. There’s no required minimum deposits and maintaining balance.
4. There’s no transfer fee when you move your funds to other banks or e-wallets. Moreover, ATM withdrawals using your ING physical card is also free of charge.
5. They have cashback promos for certain activities such as bills payment. Just check their websites for the promos that are currently running.

CIMB Bank

The second on the list is a Malaysian Bank that was established here in the Philippines last December 2018.

There are currently 3 types of savings accounts that you can open with CIMB. These are UpSave Account, Fast & Fast Plus Account, and GSave Account. The GSave account is in partnership with Gcash while the rest of the accounts are mainly introduced by CIMB.

Here’s what I like about CIMB:

1. Your Upsave and Gsave account comes with a free life insurance of up to PHP 250,000 when you maintain a minimum of PHP 5,000 on your accounts.
2. You can request for a free visa debit card when you accumulate PHP 100,000 in your account
3. Like ING, CIMB offers higher interest rates than traditional banks. 2.5% per annum for Upsave and 2.6% p.a. for Gsave, which both are subject to a 20% withholding tax.
   
   As of this writing, CIMB bank also offers a promo of up to 4% interest per annum for new accounts.

4. CIMB also have no required minimum deposits and maintaining balance.
5. You can also enjoy free fund transfer to any Philippine bank.

Komo by Eastwest

Komo is known to be the first-ever digital banking service to be offered by a Philippine local bank. It is owned by EastWest rural bank.

According to their website, KOMO is termed from the Filipino phrase Kontrol Mo ang Pera Mo (you are in control of your money), and that it was created to give Filipinos more control and flexibility when it comes to managing their money.

There are 3 Things I love about Komo:

1. Komo offers an interest rate of 2.5% per annum.
2. Komo also gives free debit card.
3. There’s no required minimum deposits and maintaining balance

DiskarTech by RCBC

Fourth on our list is a digital bank that is introduced by another Philippine Local bank, Rizal Commercial Banking Corporation (RCBC). It was launched during the pandemic and according to the bank’s chairwoman, the digital bank app aims to make banking services more accessible to unbanked Filipinos throughout the country.

Here’s what I like about DiskarTech:

1. It has a higher interest rates than the base rate of the first 3 digital banks I mentioned above, which is 3.25%.
2. There’s no required minimum deposits and maintaining balance
3. Komo offers a cardless withdrawal through RCBC’s ATM’s.

Tonik

The last on our list is Tonik. This digital bank prides itself as the first neobank in Southeast Asia, which means this bank doesn’t have any affiliation with any physical banks anywhere in the world.

I still haven’t tried Tonik but here are the things I think are impressive about this digital bank:

1. They offer the highest interest rate among the 5 banks on this list, which is up to 6% per annum.
2. There’s no required minimum deposits and maintaining balance

Overview of Digital Banks in the Philippines

Before we end, I just want to address one common question people ask about these 5 digital banks.

Is it safe to open a savings account with these Digital Banks?

Though there’s always a risk, I can say that these banks are supervised by the Bangko Sentral ng Pilipinas (BSP) and are PDIC-insured of a maximum of PHP 500,000 per depositor. This means that all of the users of these digital banks are insured up to PHP 500,000 per depositor per bank by PDIC.

Final Words

If you are after a high-interest rate savings account or a more convenient and faster banking experience, then these 5 digital banks are good options for you. The point is that these banks are offering opportunities for you to easily manage your money. The decision is yours if you want to grab the opportunities or not.