The Bangko Sentral ng Pilipinas and the National Privacy Commission have urged the banking sector to accelerate e-banking services to help consumers and the business sector cope with the disruptions of the COVID -19 pandemic.
In an online forum organized by the think tank Stratbase ADR Institute on “The Importance of Trust and Security for Digital Financial Inclusion”, Bangko Sentral ng Pilipinas Director for the Technology Risk and Innovation Supervision Department, Melchor Plabasan, said: ” Going digital right now, it’s not just a matter of convenience, it has become a matter of necessity and for the BSP we would like to sustain that momentum, and that’s why we crafted these digital payments transformation roadmap 2023.”
Plabasan said “It’s not just about the BSP, it’s also about collaborating with the industry players, collaborating with other government agencies particularly in digitizing payments of government to people and people to government. It is also about the digital transformation of the BSP. We also need to digitally transform.”
The key policy reforms in the BSP roadmap that were discussed were:
1. Technology aided Know Your Customer (KYC) that enabled Philippine citizens to open accounts remotely
2. The National Retail Payment System which gave birth to InstaPay and PesoPay
3. The Operator Payment System to oversee payment system operators and designate those considered systematically or prominently important.
4. QR code for bank transfers and expansion to merchant payments
5. Formal guidelines for establishment of digital banks in the Philippines.
National Privacy Commission Policy Advisor Anna Benjieline Puzon said “Innovation may prove to be boon and bane for the reason that while progress and development is assured, it likewise presents risks to the freedoms and privacy of the individuals availing of such services when the sale is left unbridled and unchecked.”
Puzon advised the banking sector to consider data privacy best practices in fintech (financial technology) that are able to provide the following protection:
1. Give timely notification of phishing emails or spoof banking websites to data subjects and to relevant authorities for immediate take down
2. Detect fraud and regularly monitor accounts for suspicious activities by checking if transactions exceed an established threshold
3. Provide multi-factor authentication to reinforce whatever security measures have already been established.
JJ Disini, Managing Partner of Disini & Disini Law Office and Professor at the UP College of Law, pushes for the implementation of sound governance and its continuous enforcement for increased trust and security. He said that “When you’re thinking about information security compliance, it’s not just about installing hardware and installing your firewalls. It’s about putting sound governance in.”
Stratbase ADRi President Dindo Manhit called on the Philippine government to support and prioritize digital transformation by investing in a massive digital infrastructure program that will serve as a foundational long term national asset that empowers a digitized commercial, health, education and government ecosystem.
“In so far as digitalization has become a reality of our everyday life, and in so far as the prospects of the new normal have changed how we live; the digital push could be reinforced and actualized into public benefits not only through public-private collaboration, but with a participation of the whole population, as well,” Manhit said.