The Securities and Exchange Commission’s (SEC) decision to relax minimum public ownership requirements for initial public offerings (IPOs) aims to lure large-cap firms to the local bourse, yet market observers warn that the allure of overseas markets remains a potent threat to keeping homegrown fintech giants like GCash and Maya at home.

The revised rules come as Globe Telecom Inc., the parent of GCash operator Mynt, has lobbied for lower thresholds. The telecommunications provider expressed concern that the previous 20 percent minimum public float would result in an offering size too massive for the local market to absorb without significant price pressure.

Conversely, PLDT Inc.’s Maya is reportedly weighing a United States (US) listing seeking a valuation between ₱27 billion and ₱54 billion, eyeing deeper pools of capital and a more sophisticated trading environment for financial technology firms.

The new tiered framework is clearly designed to incentivize the listing of large-scale enterprises, according to Juan Paolo Colet, managing director at Chinabank Capital Corp.

Colet noted that the move acknowledges a reality where current market conditions necessitate a lower public float to make domestic listings commercially viable.

“Hopefully this makes it easier for GCash and Maya to consider doing their mega-IPOs in the Philippines,” Colet said.

He also suggested the rules might not only pave the way for GCash and Maya but also facilitate a potential debut for state-run Land Bank of the Philippines, allowing the government to retain a larger controlling stake.

However, the shift toward lower public floats carries inherent risks. Colet cautioned that the SEC and the Philippine Stock Exchange must intensify their vigilance to protect minority shareholders.

He explained the rule change as a temporary measure, noting that the long-term objective should remain the democratization of wealth through higher public participation.

“The rule change should be seen as a temporary measure because the eventual goal should be to democratize wealth creation via increased public ownership,” he noted.

While the regulatory adjustment removes a structural hurdle, it may not be enough to counter broader market forces.

April Lynn Tan, chief equity strategist at COL Financial Group Inc., said that while the rules are a positive step, regulators cannot control investor sentiment.

This sentiment gap is a primary driver behind Maya’s interest in a foreign listing, where tech valuations typically command a premium.

Meanwhile, Jonathan Ravelas, senior adviser at Reyes Tacandong & Co., described the reform as a sensible, market-friendly evolution that prevents over-dilution for early-stage backers.

Yet, he questioned whether the lower float alone could generate enough local investor appetite to ensure a successful debut for multi-billion-peso fintechs.

“If the SEC enforces the milestones strictly, this should widen the IPO pipeline and help deepen the capital market over time,” he said.

The framework significantly improves the Philippines' competitiveness against regional peers, according to Wendy B. Estacio-Cruz, head of research at Unicapital Securities Inc.

She expects the move to revive the IPO pipeline over the next 12 to 24 months, particularly for family-owned conglomerates and high-growth firms.

“By reducing the minimum public ownership, this improves competitiveness versus regional peers and could revive the IPO pipeline over the next 12 to 24 months. While lower floats may raise concerns about liquidity and volatility, especially in mid-cap names, the continued post-listing minimums and enhanced disclosure requirements help balance investor protection with capital formation,” she noted.

Estacio-Cruz noted that while Singapore or New York remain attractive for those seeking aggressive regional expansion, the PSE is now a much stronger contender for firms prioritizing local brand positioning and controlled dilution.