Government-issued bonds will soon be accessible for retail investors through GCash, as part of the Philippine government’s financial inclusion and digitalization initiatives.
What’s the significance: The integration makes government bonds more accessible, affordable, and convenient for retail investors, as GCash has more than 83 million users.
Key Details: The Bureau of the Treasury, in partnership with GCash and PDAX, is set to launch GBonds this month.
- The Announcement: Finance Secretary Ralph Recto announced this during the 127th anniversary of the Bureau of the Treasury on November 11, 2024.
- Recto urged GCash, PDAX, and regulators to expedite the process to boost financial inclusion.
- The Goal: The initiative aims to empower Filipinos to secure their financial future conveniently from their homes.
- The Exact Date: There is still no official launch date revealed as the initiative needs pending final regulatory approvals.
Key Quote:
“We envision a future where investing in government bonds is no longer a luxury but a new normal for Filipinos – with just a few swipes away and as easy as ordering their favorite food delivery…This empowers our people to effortlessly secure their future, all from the comfort of their homes.”
Ralph Recto, Secretary, Department of Finance
How it Works: Bonds are fixed-interest securities where investors lend money to governments or corporations and earn interest, receiving the principal and accrued interest upon maturity.
- How are bonds computed: If a person buys a ₱10,000 bond with a 6% annual interest rate (APY) and a 12-month maturity, they will earn ₱600 in interest, making their total investment ₱10,600 after one year.
- In 2023: Blockchain-tokenized treasury bonds were launched through PDAX, enabling investments as low as ₱500 with a 6.2% interest rate.
- Earlier this year: The Philippines achieved a milestone by raising over $10 billion through Retail Treasury Bonds, surpassing previous records
Worth reading: Check out this BitPinas article which compares bonds and digital bank savings accounts, highlighting their features for low-risk investors.
This article is published on BitPinas: Bureau of Treasury, PDAX, GCash to Launch GBonds in December
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