BSP on track to hit digitalization goals

MANILA, Philippines — The strong double-digit growth in the share of digital payments in total retail transactions was likely sustained last year as more Filipinos embrace digitalization even with the lifting of strict COVID-19 mobility restrictions, according to the Bangko Sentral ng Pilipinas.

BSP Deputy Governor Mamerto Tangonan said the twin goals under the central bank’s Digital Payments Transformation Roadmap would be delivered this year.

“The preliminary figures I saw tell me that I have reason to be happy and confident that we will hit the 2023 target,” Tangonan told reporters.

Under the roadmap, the BSP aims to shift 50 percent of total retail transactions to electronic channels and raise the number of banked Filipino adults to 70 percent by this year.

With the COVID-19 pandemic serving as catalyst, the share of electronic payments to total retail transactions increased to 30.3 percent in 2021 from 20.1 percent in 2020.

Likewise, the number of banked Filipino adults almost doubled to 56 percent in 2021 from 29 percent in 2019.

“Of course, definitely there was an increase. And we are confident that we will make our target of 50 percent by 2023,” Tangonan added.

Despite the base effect, he said the strong growth in 2021 was sustained last year.

“If you’re coming from a strong base, the same level of growth will be less in percentage basis. But the trend continues. It strengthened our view that the customers’ preference for payments has really been shifting towards digital,” Tangonan said.

According to the BSP official, the regulator is closely working with the industry to introduce new digital payment streams after introducing the Bills Pay app to achieve the target of shifting half of total retail transactions to electronic channels this year.

“We formulate the policies but it’s the industry that practically delivers it. We don’t make apps, it’s the industry that makes apps. That’s why we are working with them,” Tangonan added.

He pointed out that the industry, through the Philippine Payments Management Inc. (PPMI), is getting ready to launch the request to pay scheme to allow payees to initiate collections by sending a request to the payor without having to provide account details or the amount.

He said another payment stream is the debit pull or Direct Debit that would clients manage recurring payments like monthly rentals, amortizations or insurance by authorizing billers to automatically pull funds from the customer’s account.