THE Bangko Sentral ng Pilipinas (BSP) is seeking the support of the business community to grow the country’s National Retail Payment System (NRPS).
Bangko Sentral ng Pilipinas Deputy Director and NRPS project head Raymond Estioko on Wednesday said the central bank targets to increase electronic payment usage from the current one percent to around 20 percent of total payments by 2020 through NRPS.
The NRPS framework was launched in December 2015 and is the flagship program of the BSP to modernize the country’s payment system as it aims to create a safe, efficient, and reliable retail payment system in the Philippines.
It is positioned to facilitate the country’s transition from a cash-heavy to a cash-lite economy, eventually bringing material benefits for the government, the business and private sectors, consumers and individuals in terms of speed and efficiency of transactions, reduced costs, improved transparency, enhanced security, and expanded access to financial services.
According to Estioko, the predominant mode of payment among Filipinos is still cash and checks.
BSP records some P2.5 billion cash/checks transactions per month and of this figure, only one percent are done through electronic means.
Estioko explained that the country’s heavy dependence on cash is due to a large unbanked population and the predominance of informal businesses whose transactions are exclusively done in cash.
The BSP official said Filipinos refuse to transact using the improved method as bank charges could go as high as P400 per transaction.
“We are on the initial phase of implementation for NRPS. We are seeking the support of the business community as well of government agencies to digitize collections and reimbursements,” said Estioko, adding that BSP will continue to drum up awareness about NRPS.
He was one of the speakers at the Innovation Summit held at the Waterfront Cebu City Hotel and Casino.
The NRPS covers all retail payment-related activities, mechanisms, institutions and users. This includes all peso-denominated domestic payments.
Last April, the BSP launched InstaPay, a real time account-to-account payments and fund transfer system. Catering to low value payments of up to P50,0000, InstaPay safely and quickly moves funds.
“Filipinos can now transact even beyond banking hours anywhere, anytime. With InstaPay, we can say that we are now at par with countries which have real-time payment instruments,” said Estioko.
BSP announced it has seven pioneer BSP-Supervised Financial Institutions capable of sending and receiving payments.
In addition, another 13 are able to receive payments. By the middle of this year the BSP expects more financial institutions to participate in InstaPay.
In parallel, the central bank is also engaging the private sector and the government to encourage the adoption of InstaPay and PESONet to meet their payment system requirements.
Using PESONet, government, businesses, and individuals can initiate electronic fund transfers and recurring payments from accounts maintained in BSP supervised financial institutions (BSFIs) to corresponding accounts in other BSFIs.
The funds will be available in the recipient account within the same banking day, or immediately upon clearing at full value with no deduction.