This means the BSP will not charge PhilPaSSplus fees until end-January 2023 after the previous suspension expired on December 30, 2022.
As part of its time-bound relief measures for banks during the pandemic, the BSP has waived PhilPaSSplus fees since April 2020.
BSP owns and operates the PhilPaSSplus real-time gross settlement (RTGS) system. It processes and settles interbank high-value payment transactions between banks.
The BSP has suspended PhilPaSSplus fees on six types of transactions, including interbank, the peso-leg of US dollar trades and government securities trades, Philippine Clearing House Corp. (PCHC) transactions, automated teller machines or ATM transactions, and manual interbank transaction processing.
Pre-pandemic, PhilPaSSplus fees for interbank transactions were already free for transaction of USD 1.79 or less. For the peso-leg of US trades a USD 0.08 fee was charged up to USD 8.928 transaction value and USD 0.18 from more than USD 8.928 to USD 17.857.
Because of the suspended fees, the BSP's revenue from PhilPaSSplus fell by 74.3% from end-June 2022 to end-September 2022.
As outlined in its Digital Payments Transformation Roadmap 2020-2023, the BSP aims to improve payment digitalisation in the country. The goal is to create an efficient, inclusive, safe, and secure digital payments ecosystem. This should then support the diverse needs and capabilities of individuals and firms, to achieve the BSP's mandates. The central bank envisions two strategic outcomes from this goal.
One is a stronger consumer preference for digital payments, with 50% of total retail payments shifting to digital, as payment services are also a gateway for Filipinos to enter the formal financial system. This goal entails increasing the number of financially included Filipino adults to 70% by introducing them to the formal financial system via payment or transaction accounts.
The Philippines Identification System (PhilSys) for Know Your Customer (KYC) compliance; and next-generation payment and settlement services are also expected to result in more innovative and responsive digital financial services.
PhilPaSS Plus has been operational since June 2021. Some regional bank operations went live via the PhilPass Plus browser as a manual transaction entry and management portal – PhilPass Plus has three other payment channels. The BSP has maintained contact with each bank involved through a designated coordinator at each institution, who is responsible for informing the BSP of progress and achievement of key testing milestones.
The rulebook ensures that all participants have a common understanding of how ISO 20022 payments will operate. The BSP has its own readiness portal, which allows banks to test their ability to adhere to rulebook flows even before the UAT.
PhilPaSS Plus has 176 participants, including commercial, savings, and rural banks. The transformation program, led by the BSP, will replace the domestic payment and settlement system, establishing ISO 20022 as the standard language of Philippine financial transactions. Therefore, it can be said that the digital infrastructure of the banking industry in the Philippines is going through a significant transformation.
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