By Lee C. Chipongian
The Bangko Sentral ng Pilipinas (BSP) wants to be the generating agency for the Philippine national ID system in its efforts to advance the financial system’s digitalization and financial inclusion.
“We want to create it,” BSP Governor Benjamin E. Diokno said on the sidelines of the 1st Inclusion and Digital Transformation or INDX Summit by Fintech Alliance.ph held at the BSP Assembly Hall yesterday.
The government has estimated a P2-3 billion budget to produce the national IDs but due to some lag in funding approvals, it might take some time for the Philippine Identification System (Philsys) to access it while the BSP already has the money.
Sources said the Monetary Board has initiated discussions on the proposal since the BSP could easily absorb the costs of producing the national IDs.
The same sources said Diokno wants the BSP to do it because it will translate to more savings for the government and accelerate programs for financial inclusion. The plan was to provide ID numbers and capture the biometrics of more than 100 million Filipino citizens as well as non-Filipino residents over a five-year period.
The BSP has been loud in the past in pushing for the establishment of a national ID system as this will help its digital payment ecosystem under the National Retail Payment System.
In a separate statement, the Bankers Association of the Philippines (BAP) announced on Tuesday that it has launched the digital banking ID registry.
BAP President Cezar P. Consing, also president and CEO of Bank of the Philippine Islands, said this will help further financial inclusion in the country. The BAP ID registry coincides with the organization’s “increased focus on cybersecurity” programs.
“The Philippine banking industry is transforming itself so as to continue to be relevant to one of the world’s fastest growing economies,” said Consing.
“Digitalization, cybersecurity, and financial liberalization are issues foremost on bankers’ minds.The overall objective is increasing financial inclusion — the imperative of our times.”
The BAP ID registry will set the foundation for e-KYC (electronic know-your-customer) and future use cases. It will be powered by blockchain technology and several of the BAP member banks are already developing the systems to be able to interface with the ID registry, according to BAP.
In Diokno’s first address as new central bank chief, he told participants of the INDX Summit that the BSP under his watch will continue to have an enabling regulatory environment for the expansion of the fintech and fintech-related industry. “I fully support and will carry forward our financial inclusion agenda,” he said.
Diokno in his speech said the BSP will be “working closely” with the Philippine Statistical Authority and other government agencies for a permanent national ID for each local residents, and for the “successful implementation of the Philippine Identification System (Philsys).”
“Philsys aims to provide every Filipino a unique and verifiable digital ID and is envisioned to be a platform for innovations in consumer service delivery,” said Diokno. “With Philsys, all Filipinos can have the tools to meaningfully participate in the gains of an increasingly digitalized economy.”
The Philippine ID System Act was signed into law August of last year, as Republic Act No. 11055 (An Act Establishing the Philippine Identification System) and it will install a biometric-based, foundational, national ID system.