MANILA, Philippines – The Bangko Sentral ng Pilipinas (BSP) is looking at increasing the share of electronics payments in the country’s total financial transactions to 20 percent over the next five years with the roll out of the National Retail Payment System (NRPS).
BSP Governor Amando Tetangco Jr. said the launch of a safe, efficient, and reliable electronic retail payment system that is interconnected and interoperable would increase the share of electronic payments to 20 percent by 2020 from the current level of only one percent.
“With the NRPS we hope to see the one percent share of electronic payments increase to at least 20 percent by 2020. So it is 20 by 2020,” Tetangco said.
Tetangco cited a data from the Better Than Cash Alliance (BTCA) that showed only one percent of about 2.5 billion payment transactions worth $74 billion made by Filipinos per month are electronic despite the high mobile penetration rate in the country.
BTCA added that e-commerce makes up less than one percent of total commerce in the Philippines compared to four to five percent in Thailand, Vietnam, and Indonesia as well as the 10 to15 percent in developed countries.
The BSP said the NRPS is positioned to facilitate the country’s transition from a cash-heavy to a cash-lite economy, eventually bringing material benefits for governments, the business and private sectors and even regular consumers in terms of speed and efficiency, reduced costs, improved transparency, enhanced security, and expanded access to financial services.
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“The NRPS is a rare opportunity for all of us to work together to do something that can be a real positive game changer for the economy and for our people,” Tetangco said.
Tetangco said a switch from check to direct credit would save the country’s banking sector $1.52 per payment.
If all the local checks cleared in 2013 were electronic payments instead, he said the industry could have saved $272 million or about 8.5 percent of the net income after tax of all banks operating in the Philippines.
For his part, BSP Deputy Governor Nestor Espenilla Jr. said the next step after the launch of the NRPS is the establishment of the self-governing Payment System Management Body (PSMB) within the first semester of next year.
Espenilla said the BSP in consultation with the industry and other stakeholders would provide principles to guide the clearing participants in setting and implementing policies and standards to govern retail payments.
According to him, the NRPS would be fully operational by the middle of 2017.
Various groups led by Bankers Association of the Philippines, Chamber of Thrift Banks, Rural Banks Association of the Philippines, among others have committed support for the NRPS.
