PESONet, InstaPay placed under tighter BSP watch

MANILA, Philippines — The Bangko Sentral ng Pilipinas (BSP) has placed the PESONet and InstaPay under closer supervision and monitoring to protect the public after both automated clearing houses were designated as prominently important payment systems (PIPS).

BSP Governor Felipe Medalla said the designation of PESONet and InstaPay as PIPS pursuant to Republic Act 11127 or the National Payment Systems Act (NPSA) further promotes consumer welfare as the central bank continues to make progress toward its twin goals under the Digital Payments Transformation Roadmap.

“The designation of PESONet and InstaPay as PIPS is considered timely, as these payment systems will facilitate the launch of other use cases for digital transactions, such as interoperable bills payments and direct debits,” Medalla said.

Under the roadmap, the BSP aims to convert 50 percent of total retail payments in terms of volume to electronic channels and increase the number of Filipino adults with bank accounts to 70 percent by 2023.

The BSP earlier reported that the share of digital payments to total retail transactions increased further to 30.3 percent in 2021 from 20.1 percent in 2020, while the number of banked Filipino adults jumped to 53 percent from 29 percent.

Under the Payment System Oversight Framework, PIPS refers to a payment system which may not trigger or transmit systemic risk, but could potentially cause adverse economic impacts or undermine the confidence of the public in the national payment system or in the circulation of money.

PESONet and InstaPay are digital payment schemes launched in 2017 and 2018 under the National Retail Payment System (NPRS). Their usage grew significantly during the pandemic.

PESONet is a batch electronic fund transfer service and is a viable alternative for checks and recurring payments, while InstaPay is a real-time, low-value payment substitute for cash transactions.

PESONet and InstaPay are operated by the Philippine Clearing House Corp. and BancNet, respectively.

Both payment systems are expected to comply with international standards that foster safe, efficient, and reliable operations, particularly those provided under BSP Circular 1126.