THE Bangko Sentral ng Pilipinas (BSP) is pushing for the digitalization of the Philippine banking sector to help the majority of Filipinos integrate into the financial ecosystem.
This was emphasized during a virtual town hall discussion hosted by think tank Stratbase ADR Institute (ADRi) on “The Importance of Trust and Security for Digital Financial Inclusion.”
BSP Director for Technology Risk and Innovation Supervision Department Melchor T. Plabasan said in the forum that the objective of the digital transformation roadmap “is to transition 50 percent of our retail payments to digital and to ensure that 70 percent of adult population has access to a transaction digital account, which they can use or their day-to-day transactions.”
“Going digital right now, it’s not just a matter of convenience, it has become a matter of necessity and for the BSP, we would like to sustain that momentum that’s why we crafted [this] ‘Digital Payments Transformation Roadmap 2023,’” Plabasan said.
The BSP official bared key policy reforms in the BSP roadmap: the National Retail Payment System, which gave birth to InstaPay and PesoPay; technology-aided “Know-Your-Customer” (KYC) that enabled Philippine citizens to open accounts remotely; Operator Payment System to oversee payment system operators and designate those considered systematically or prominently important; Formal guidelines for establishment of digital banks in the Philippines; and, QR (quick response) code for bank transfers and expansion to merchant payments.
“It’s not just about the BSP, it’s also about collaborating with the industry players, collaborating with other government agencies particularly in digitizing payments of government to people and people to government,” Plabasan said. “It is also about the digital transformation of the BSP. We also need to digitally transform.”
In the same forum, National Privacy Commission Policy Advisor, Attorney III, Anna Benjieline R. Puzon advised that banks adopt the best financial technologies that can provide bank accounts the following security features: multi-factor authentication to reinforce whatever security measures already established; timely notification of phishing e-mails or spoof banking web sites to data subjects and to relevant authorities for immediate take down; and, fraud detection and regular monitoring of accounts for suspicious activities.
“Innovation may prove to be boon and bane for the reason that while progress and development is assured, it likewise presents risks to the freedoms and privacy of the individuals availing of such services when the sale is left unbridled and unchecked,” Puzon said.
Stratbase ADRi President Victor Andres C. Manhit called on the Philippine government to support and prioritize digital transformation by investing in a massive digital infrastructure program that will serve as a foundational long term national asset that empowers a digitized commercial, health, education and government ecosystem.” “In so far as digitalization has become a reality of our everyday life and in so far as the prospects of the new normal have changed how we live; the digital push could be reinforced and actualized into public benefits not only through public-private collaboration, but with a participation of the whole population, as well,” Manhit said.
Lawyer Jose Jesus “JJ” M. Disini Jr., managing partner of Disini & Disini Law Office, pushed for the implementation of sound governance and its continuous enforcement for increased trust and security.
“When you’re thinking about information security compliance, it’s not just about installing hardware and installing your firewalls,” Disini, who is also Associate Professor at the University of the Philippines College of Law, added. “It’s about putting sound governance in.”