BSP sets up clearing house for digital payments
Lawrence Agcaoili (The Philippine Star) - November 8, 2017 - 4:00pm

MANILA, Philippines — The Bangko Sentral ng Pilipinas (BSP) has launched the batch electronic fund transfer (EFT) credit automated clearing house (ACH) as it pursues a safe, efficient, and reliable digital or electronic payment system.

BSP Governor Nestor Espenilla Jr. led yesterday the ceremony launching the Philippine EFT System and Operations Network (PESONet) to facilitate fund transfer from one account to one or several accounts maintained in different financial institutions.

It is the first ACH under the National Retail Payment System (NRPS) launched in Dec. 2015 to increase the adoption of greater use of electronic payments and to shift to cash-lite society from cash-heavy society.

PESONet is one of the ACHs prioritized for implementation given its potential to be an efficient channel for government and private business collections and disbursement. PESONet provides an electronic alternative to the still widely used paper-based check system.

Through PESONet, businesses, the government and individuals will be able to conveniently initiate electronic fund transfers and recurring payments from the sender’s accounts maintained in BSP supervised financial institution (BSFI), such as banks and other non-bank electronic money issuers, to corresponding recipient accounts in other BSFIs.

Espenilla said the ACH has attracted 33 financial institutions and the number is expected to increase as the demand for better EFT services intensifies.

With the ACH, funds can be made available to the recipient accounts within the same banking day or immediately upon clearing.

Payees receive the funds transferred in full free of charge resulting in greater transparency and to help clients determine which EFT products offer the best value for their money.

All participating banks are required to disclose to the central bank the details of all fees to be posted at the BSP website.

Digitizing retail payments is critical in the Philippines considering that 99 percent of payment transactions per month are done in cash, with businesses and individuals making only one percent and 0.3 percent electronic payments, respectively, according to a study done by the Better Than Cash Alliance.

The NRSP aims to increase electronic retail payment transactions to 20 percent by 2020 from the current one percent.

BSP Deputy Governor Chuchi Fonacier said the BSP would soon sign an agreement with the Philippine Payments Management Inc. (PPMI) which would serve as payments management body for the NRPS.

The PPMI was organized by the Bankers Association of the Philippines  to act as a supporting body of the BSP by monitoring proper implementation and progress of NRPS to achieve its end-goal of a more accessible and competitive financial system through digitization of financial transactions.

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