MANILA, Philippines - The Bangko Sentral ng Pilipinas (BSP) is laying down the foundation for an electronic retail payments system over the next two years to generate savings and at the same time expand the reach of financial services to more Filipinos.
BSP Deputy Gov. Nestor Espenilla Jr. recently told reporters on the sidelines of the Sustainability Summit organized by the Bank of the Philippine Islands (BPI) the central bank is now finalizing the guidelines for the National Retail Payment System (NRPS).
“We’re actually working on the constitution of the NRPS. Basically, it’s a partnership of many banks, payments providers, and telcos. So you need to have a good constitution so people will properly coordinate and compete in a healthy way,” he said.
Espenilla explained the NRPS would create a payments system for electronic commerce transactions as well as an interoperable environment for various kinds of electronic payments systems covering cards, mobile devices, point-of-sales, among others.
NRPS envisions Filipinos to have easy access to financial services and have accounts to make payments, and receive or transfer funds to other accounts anytime, anywhere, at a reasonable price from any digital device.
Efficient retail payments contribute to the stability and efficiency of the financial system and the economy as a whole.
The country diagnostics conducted by the Better Than Cash Alliance (BTCA) showed Filipinos make about 2.5 billion payment transactions per month worth $74 billion.
However, only one percent is transacted electronically while 99 percent of the transactions are paid either in cash or checks.
“What we want to do is to move the dial significantly towards doing most of that electronically. But that wont happen unless you create an ecosystem that is trusted, efficient, and affordable,” Espenilla said.
Espenilla said the BSP is now talking with various shareholders particularly banks as well as telco providers to convince them to link their payments systems.
“It is a very challenging task. Right now, every bank would have their own mobile payments solution while the telcos have their own GCash, Smart Money. But not on of them interoperate with one another,” he added.
Earlier, BSP Governor Amando Tetangco Jr. said studies have shown that shifting from paper based to electronic-based payment system could generate an annual savings up to one percent of gross domestic product (GDP).