By Lee C. Chipongian
Bangko Sentral ng Pilipinas (BSP) Governor Benjamin E. Diokno said 30 percent of the payments transactions in the Philippines are now digital or electronics-based, way ahead of the target of achieving at least a 20 percent cash-less payments by 2020.
Diokno said the new goal for 2020 is 30 percent cash-lite financial system but he thinks that the target has already been achieved.
By the end of his term in 2023, he is projecting 100 percent coverage of digital payments which will become the norm and not the exception. “There are preconditions to (get to) this,” he said in a press briefing before the BSP launching of the Egov Pay and QR Ph on Tuesday.
First, he said the Philippines would need a more reliable and faster Internet connection to ensure the target will be reached.
Diokno said, however, that by 2023, it will not be strictly a cash-less society, rather, a cash-lite financial system. “It’s not cash-less but cash-lite. Right now, we are cash-heavy but I think (we will have a) cash-less society in 10 years,” he said.
BSP Managing Director Vicente T. De Villa III said the EGov Pay participants and the QR Code compliance are expected to increase over time. The EGov Pay for example already has nine agencies including local government units (LGUs) lined up.
De Villa said as an e-payment solution for a “secure, fast and convenient way” of paying, the EGov Pay Facility – after getting on board the Bureau of the Internal Revenue – more government agencies will be tapping the facility, including the Department of Trade and Industry and the Philippine National Police. The pilot EGov Pay was offered for BIR taxpayers through the Land Bank of the Philippines.
For the QR Code compliance, De Villa said industry compliance for the end-June 2020 deadline for the payment service providers (PSPs) is “moving along” and that “everyone is expected to comply” on time.
The BSP has approved the adoption of a National QR Code Standard last month and is giving PSPs until June 30 next year to fully comply with the QR policy. The PSPs will adopt the QR Code Standard within thirty days after notification.
The newly approved QR Code Standard is necessary for the interoperability of QR-enabled payment and financial services. The BSP said it enables the Payment System Management Body and the PPMI to determine the National QR Code Standard for both banks and non-banks.
“The QR is primarily intended to enable micro-merchants to accept electronic payments,” said Diokno. “We hope that through the help of our industry partners, we can not only achieve our goal of a cash-lite economy but also enable more Filipinos to reap the benefits of a growing economy.”
The QR Ph has six pilot participants and the funds are transferred through the InstaPay, part of the National Retail Payment System. The PSPs participating institutions include the Asia United Bank, China Banking Corp., LBP, Rizal Commercial Banking Corp., PayMaya, and Union Bank of the Philippines.
“The use of QR codes for payments has been gaining traction as an alternative to the traditional debit and credit card payments,” said the BSP. It said QR technology has “emerged as the most expedient means of payment since it essentially entails code scanning which is faster and easier to do than bringing out a card, tapping, dipping or swiping it, and signing a charge slip in most cases.”