In March, BDO Universal Bank President Nestor V. Tan turned over the leadership of the Bankers Association of the Philippines (BAP) to Bank of the Philippine Islands (BPI) President and Chief Executive Officer Cezar “Bong” P. Consing.
Mr. Bong vows to pursue innovation and financial inclusion programs, a commitment of the influential group, which is likewise the vision and mission of the monetary authorities to maximize the economic growth potential of the country.
This comes amidst the headwinds – a slowdown in the economic growth of advanced nations and high tariff that could drag down trade performance, which the International Monetary Fund (IMF) identified as major catalysts in its decision to downgrade the global economic growth outlook.
For the third time in six months, the IMF reduced its world economic assumption to 3.3 percent from 3.5 percent, the frailest in a decade. Local market analysts are of the view that the Philippines could withstand these risks and challenges.
The country wears three shields: sustained dollar remittances from overseas Filipino workers (OFWs), the flourishing Business Process Outsourcing (BPO), and improvements in the flow of Foreign Direct Investments.
IMF’s Bretton Woods sister, the World Bank, acknowledged that the Philippines in 2018, while experiencing a slight narrowing in remittances because of the decrease sent from Gulf economies largely due to geo-political situations, as remaining on the top front of remittances or money transfers at $34 billion.
In order to “continue to be relevant to one of the world’s fastest growing economies,” Mr. Bong, in his acceptance remarks, described the Philippine banking industry as in a crucial phase of metamorphosis.
He said he believed BAP’s centerpiece project of digital banking ID registry coupled with enhanced cyber security and financial liberalization, could bridge the gap to link-up the still unbanked Filipinos, particularly those in the countryside. Higher savings ratio is fundamentally essential for a growing economy.
The ID registry sets the foundation for e-KYC (electronic Know-Your-Customer) and future use cases. Powered by blockchain technology this employs an unalterable distributed ledger of transactions used to ascertain and vet transactions and client identity. It allows its BAP member-banks to access the information only upon customer’s request, making it easier and faster for clients to open accounts and avail of banking services.
Updating me on the latest development in registry, BAP Managing Director Benjamin Castillo said it’s basically complete with 11-member banks – BDO, RCBC, Union Bank, EastWest, BPI, United Coconut Planters Bank, Citibank, Asia United Bank, ING Bank, Metrobank, Robinsons Bank, and the Philippine National Bank – developing their own unique systems to interface with the ID registry.
A legacy of Mr. Nestor’s BAP presidency, Mr. Ben and his team labored for two years for its realization. He is passionate about the registry and its eventual adoption by other member-banks. Showing me the video-clip on how it works, he explained that without the registry, opening up a new account with another lender is time consuming and administratively uneconomical.
Using the digital ID registry, bank customers save 15 minutes of their precious time and more convenient for OFWs to send money to their beneficiaries. Since the transaction is paperless, it reduces carbon footprints, thus, the banking industry’s contribution to preserving mother earth.
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