BSP urges public to use digital money for cash gifts

Robie de Guzman   •   November 22, 2021   •   415

MANILA, Philippines – The Bangko Sentral ng Pilipinas (BSP) on Monday called on the public to use their digital wallets when sending cash gifts this holiday season.

​The BSP said that the use of digital money as an alternative means of giving cash gifts is “highly recommended to reduce physical contact and virus transmission between giver and receiver” amid the persisting threat of COVID-19.

“Digital wallets offer a safe, secure, efficient, and convenient way to transfer funds to family and friends during this season of giving,” BSP Governor Benjamin Diokno said in a statement.

The central bank said the widespread use of digital money is in line with its digital payment transformation and financial inclusion goals.

Citing latest reports, the BSP said it has achieved its target of reaching 20 percent of digital payments volume by 2020, largely driven by high-frequency, low-value retail transactions through electronic fund transfers.

“The BSP remains committed to catalyzing digitalization of payments and digitizing at least half of all transactions by 2023 in its push to promote a more inclusive and tech savvy Philippine economy,” it said.

Bangko Sentral backs digitalization of microfinance institutions

Robie de Guzman   •   December 3, 2021

MANILA, Philippines – The Bangko Sentral ng Pilipinas (BSP) on Friday expressed its commitment to help the country’s microfinance institutions (MFI) to move forward in their digitalization journey.

In a statement, the BSP said MFIs play an important role in promoting financial inclusion in the countryside as last-mile financial service providers.

“We continue to engage the donor and development communities to encourage the provision of technical and financial assistance for the digitalization initiatives of MFIs,” BSP Governor Benjamin Diokno said in a conference with a network of microfinance entities.

“We are thus working to further ensure MFIs are equally placed alongside big industry players and well-positioned to advance financial inclusion beyond the pandemic,” he added.

The BSP said that as of the first quarter of 2021, there are 149 microfinance banks servicing 2.05 million borrowers.

Diokno urged MFIs to explore digital innovations under the BSP’s Digital Payments Transformation Roadmap (DPTR).

“The roadmap envisions 70 percent of Filipino adults owning a transaction account and at least 50 percent of transactions done digitally by 2023,” he added.

A key DPTR initiative is the rollout of the PhilSys ID, which MFIs can use to conduct Know-Your-Customer activities online and in real time to reduce onboarding costs.

Another DPTR initiative is the BSP’s issuance of a policy on digital banks, which can act as service partners for MFIs.

A digital bank offers financial products and services that are processed end-to-end through a digital platform or electronic channel.

The BSP said it also endorsed Executive Order No. 127, which promotes satellite broadband technologies to advance rural connectivity.

This reform initiative can help MFIs deliver financial services more efficiently to rural communities, it added.

Bangko Sentral closes application for new non-bank e-money issuers

Robie de Guzman   •   December 2, 2021

MANILA, Philippines – The Bangko Sentral ng Pilipinas (BSP) on Thursday announced it is closing for two years the applications for new non-bank electronic money issuers (EMI).

In a statement, the BSP said the moratorium will be imposed beginning December 16.

“The Monetary Board decided to recalibrate the approach in handling applications from non-bank institutions for new EMI licenses in line with the thrust of the Bangko Sentral to promote financial stability and strengthen public confidence in the digital economy,” it said.

The central bank said the approach involves the closure of the regular application window for new EMI-Others license for non-bank financial institutions for a period of two years and the introduction of the test-and-learn pathway for innovative e-money solutions that offer strong value propositions.

“This strategic change will enable the Bangko Sentral to monitor the performance of current market players and the risks they pose to the financial industry. This will also allow us to assess their impact in relation to our financial inclusion and digital payments transformation objectives,” said BSP Governor Benjamin Diokno.

The BSP said all applications it received until December 15, 2021 will be processed on a first-come, first-served.

“These will be assessed for completeness and sufficiency of documentation/information submitted as well as compliance with other applicable requirements,” it added.

Applications received until December 15, 2021 with noted deficiencies will be returned and considered closed, the central bank said.

New applications beginning December 16, 2021 will no longer be entertained, it added.

The BSP said the policy approach introduced the test-and-learn pathway for new non­-bank EMI applicants with new business models, unserved, targeted niches, and/or (new technologies.

“In particular, said applicants may still participate in the digital payments and financial ecosystem by requesting for exception under the Test-and-Learn / Regulatory SandboxFramework,” it said.

“The specific guidelines governing new non-bank EMI applications under the Regulatory Sandbox Framework shall be covered by a separate issuance,” it added.

Diokno explained that the policy decision “reflects our commitment to espouse an enabling environment for responsible and responsive innovation in the financial industry.”

“At the same time, we will be able to ensure that the business environment continues to serve the public interest, allow healthy competition among market players, and foster safe and interoperable payments for the digital economy,” he added.

As of end-October 2021, the BSP said there are already 35 licensed non-bank EMls, which is more than three times the number of players in 2019.

Bangko Sentral eyes offline digital payments to boost financial inclusion in off-grid areas

Robie de Guzman   •   November 30, 2021

MANILA, Philippines – The Bangko Sentral ng Pilipinas (BSP) on Tuesday said it is eyeing offline digital payment solutions to enable transactions without the need for internet connection.

In a statement, the BSP said this is part of an effort to boost financial inclusion in off-grid areas.

While an effective and reliable internet connectivity is a necessary condition for digital finance to flourish, BSP Governor Benjamin Diokno said the central bank is also pursuing digital solutions to enable ‘offline payments.’

The BSP said it is working on this initiative under the Digital Payments Transformation Roadmap (DPTR), which aims to convert 50 percent of the volume of retail payments into digital form.

The initiative also aims to onboard 70 percent of Filipino adults to the formal financial system by 2023.

The BSP earlier reported it has achieved its target of reaching 20 percent of digital payments volume by 2020. The increase was largely driven by high-frequency, low-value retail transactions through electronic fund transfers.


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