Fintech Startup Salmon Gains Banking License After Buying Controlling Stake in a Rural Bank

A local financial technology company has become an officially licensed bank after it acquired a controlling interest in a Laguna-based financial institution. In a news release, Salmon said it received regulatory approval from the Monetary Board of the Bangko Sentral ng Pilipinas to purchase 59.7 percent of Rural Bank of Sta. Rosa (Laguna), which first opened in 1963. 

Salmon, a consumer fintech startup backed by Abu Dhabi’s sovereign wealth fund ADQ, said the bank’s license and geographic footprint will enable it to offer AI-centric consumer credit and debit products nationwide. The company said it intends to maintain and enhance the bank's offline presence, inject significant capital and technology into the bank to upgrade its offering for all customers, and open more branches subject to the approval of the BSP.

ALSO READ

Frozen Accounts, Delays in Salary Disbursement: What's Happening with Salarium?

Funding Slows But Opportunities Remain: PH Startups Ecosystem Report 2023

“We are excited to undertake this important next step in Salmon’s development and grateful for the continued support of the BSP and its vision of driving financial inclusion in the country,” said Raffy Montemayor, Salmon’s co-founder and business head in the Philippines. “The transaction will help us reach additional underserved communities in the Philippines, bringing modern, customer-centric and easy-to-access financial services to more people, regardless of smartphone ownership or customer location as we combine offline and online settings for providing our services. 

“This transaction aligns seamlessly with our mission and values to expand financial inclusion and offer modern financial products to every Filipino, and we look forward to continuing our productive cooperation with the BSP to help us fulfill this mission,” he added. “We are proud of the fantastic relationship we have developed with the executive team of the Rural Bank of Sta. Rosa (Laguna), and look forward to building a robust financial institution together to continue serving communities across the Philippines.”

Salmon is one of only a handful of other fintech companies operating licensed banking institutions in Southeast Asia. The company says it plans to maintain and enhance the Rural Bank of Sta. Rosa’s offline presence, injecting significant capital and technology into the bank to upgrade its offerings for all customers. 

What is Salmon?

Established in July 2022, Salmon is a consumer financial technology company looking to expand financial inclusion through AI and data-driven banking solutions. Its founders are banking and IT veterans Pavel Fedorov, George Chesakov, and Montemayor.

Salmon first went live in the Philippines in January 2023 when it launched a point-of-sale lending service in partnership with an initial 30 merchants. The company said then that the product, essentially a buy now pay later (BNPL) scheme would enable Filipinos, including underbanked and unbanked customers, to defer payment and spread the cost of their purchases over several monthly instalments.

In July 2023, the startup announced that it secured a $20 million debt facility from U.S.-based emerging markets specialist investor Argentum Creek Partners. It said it planned to use the funds to expand its loan book and launch new products.

Besides ADQ, Salmon is backed by several other international and Filipino investors.