THE Bangko Sentral ng Pilipinas (BSP) has monitored the growing trend for mobile financial service (MFS) usage and is taking steps to ensure that this will not be used in suspicious transactions like money laundering.
Melchor Plabasan, acting deputy director and head of the central bank’s Core Information Technology Specialist Group, said the BSP maintains a safe and
efficient payment system and ensures financial stability of the banking industry through adoption of a robust technology risk-management system.
He said G-Cash and Smart Money and the banks’ mobile-banking usage are growing fast.
“We are duty bound to ensure that MFS are not used for money laundering, terrorist financing and other unlawful activities,” Plabasan said.
“Given all these initiatives, we expect the transition from cash-heavy to cash-light society. We can’t do away with cash. Ultimately the objective is the transition of the 10 percent to 20 percent of payments to electronic form from the traditional cash and check,” he told the BusinessMirror.
Some of the issues raised were the need to have an evolving regulatory framework capable of addressing the growing concern brought about by innovation.
“What we have is a regulatory regime that is flexible and cautious, which allows innovation to flourish in a safe, sound and sustainable manner,” he said.
He added that the mobile financial companies and the technology were integral part of the financial-inclusion advocacy of BSP.
BSP Bank Officer-Inclusive Finance Advocacy staff Rochelle Thomas said the central approach of the central bank is the openness to innovation.
She said this regulatory openness should be about willingness to dialogue with the market, understand the risk that this innovation poise and adequately manage those risks.
“If the regulator is comfortable with the business model and how to manage the risks that are attendant to this product and business model, then that gives us confidence to approve it. For example, the G-Cash,” she said during the recent Mondato Summit Asia.
“We’re working on cashless ecosystem. We partnered with banks for cash in. You can transfer money from your bank account to mobile money account. You can use G-Cash to send money and it’s really efficient to manage your account,” Mynt President and CEO John Rubio said.
Mynt, the financial technology arm of Globe Telecoms, has several partner banks that include its affiliate bank, Bank of the Philippine Islands, PS Bank, Rizal Commercial Banking Corp. and, soon, Security Bank.
The telecommunication companies were working on the interoperability of G-Cash and Smart Money to meet the deadline set by the central bank in January 2016.
Ultimately, they will form part of the National Retail Payment System, or NRPS, a single integrated solution for clearing, settlement payment operation and switching of transactions that is being handled by BancNet.