PPMI sees surge in e-money transfers

CEBU, Philippines — Philippine Payments Management Inc. (PPMI) expects more industry players to start using Instapay which will drive up the volume of electronic money (e-money) transfers. Instapay, the recently established automated clearing house (ACH), provides the infrastructure for financial institutions, allowing the banking public to have seamless interbank fund transfers.

The self-regulated organization, recognized by the Bangko Sentral ng Pilipinas (BSP) as the Payments System Management Body (PSMB) to implement the National Retail Payment System (NRPS) framework under BSP Circular 980, is looking at over 100 BSP-supervised financial institutions (BSFIs) participating as they move towards increased digitalization efforts.

“There were a total of 20 participants on the day of its launch in April 2018 but only 7 institutions have the capacity to send and receive payments via Instapay. We expect this number to grow to over 100 or at least 90 percent of all BSFIs, as each company ramps up their system readiness to participate,” said Abraham Co, PPMI president.

PPMI recognizes that different financial institutions have different IT infrastructure, adding that “some adopt quickly while others are not as nimble to connect to Bancnet.”

PPMI added that check payments and automated teller machine (ATM) transactions would likely shift to e-money transfers since this is the fastest way to safely move funds, enabling the public initiate real-time payment transactions.

“Significant volumes should shift to this platform within a year’s time. Today, about 75% of checks processed daily are below Php 50,000. Right here is an immediate market for Instapay. E-transfers could also reduce cash transactions which can impact ATM usage,” Co added.

PPMI said that e-money transfers will soon prevail for as long as the banking industry ensures security of the network while participants continue to create financial products.

“The banking public will want to use Instapay because of the user-experience it provides. It is a quick, easy and secure option for money transfers and payments,” said Co.

PPMI sees NRPS to transform the way BSFIs provide financial services to the Philippine market. “There are other use cases in the future that we can provide. We can do countless opportunities from domestic remittances and payment to merchants to cash-out services,” Co said.