In his first meeting with fintech industry leaders, Bangko Sentral ng Pilipinas’ (BSP) new deputy governor in charge of digital payments underscored similar interests with stakeholders towards a cash-lite economy.
“We have a convergence of goals, we both want the same thing,” said Deputy Governor Mamerto Tangonan of the new Payments and Currency Management Sector (PCMS) in a speech delivered during the recent Fintech Alliance.ph’s General Membership Meeting.
“There should be nothing that can stop us from collaborating and making sure that both our goals are met. For our side, that it remains efficient, safe, and reliable payments service that you’re going to launch, for you to discharge your responsibilities very responsibly. I’ll be happy to see you very successful in this industry,” Tangonan added.
As the deputy governor leading the PCMS, Tangonan’s main role is to maintain the safety and integrity of the Philippine currency and to ensure a well-functioning payment and cash ecosystem that is sustainable and that will contribute to economic growth.
The Fintech Alliance.ph welcomed Tangonan in his first public appearance as he talked about the PCMS’ goals in the coming years.
“This topic is very much important and relevant to everyone especially on promoting financial inclusion and digital literacy. The industry is one with the initiatives of the BSP Governor Diokno, the entire BSP, and the government in general in terms of promoting a sustainable digital economy for the Philippines,” said Lito Villanueva, founding chairman of Fintech Alliance.ph and executive vice president and chief innovation and inclusion officer of RCBC.
True to the BSP’s Digital Transformation Roadmap for 2020-2023, Tangonan advocates for an efficient, inclusive, and safe digital payments ecosystem. He believes this entails the full participation of key industry players, such as the members of Fintech Alliance.ph. As regulator, he acknowledges the needs of the industry and how hand in hand, the government and the private sector can benefit in the central bank’s digital acceleration goals.
“Our main mandate is to ensure that our economy has access to a safe, reliable, and efficient payment system. We’ll ensure that the industry remains competitive, there is a level playing field, that it is inclusive, that those players who are qualified and meet the criteria for safety and reliability and efficiency could participate. And to that we will have to of course issue or formulate the proportional policies, to ensure those, to achieve our mandate, without being an overly regulated industry,” Tangonan said.
Under the PCMS are three other subsectors including the Payments and Currency Development Subsector, Payments and Currency Management Operation Subsector, and the Currency and Securities Production Subsector. These subsectors provide a more holistic view of the physical and the digital payments systems in the country.
While the physical cash remains a primary mode of transaction, Tangonan supports the promotion of shifting the preference of Filipinos towards digital payments. Same with the Digital Transformation Roadmap, he aims to convert 50% of the total volume of retail payments into digital form and expand financial inclusion by onboarding 70% of Filipino adults to the formal financial system through the use of payment or transaction accounts.
Tangonan emphasizes that financial inclusion and digitalization go hand and hand, underscoring the importance of an accessible, safe, and efficient payments system in reaching out to the underserved segment of the population. He added that digital financial products and services offered by financial institutions should be responsive to the needs of consumers. The Fintech Alliance PH supports the same goals of the central bank.
From the PCMS’s end, the on-going implementation of the digital ID system and the support of next-generation payment and settlement systems to facilitate real-time processing of financial transactions can help hasten and ensure the safety of transactions with the government and the private sector.
