The Central Bank of the Philippines (BSP) said it will focus on exploring digital currency for fast and cheap transactions between financial institutions.
BSP Governor Felipe Medalla said that the central bank is interested in launching a state stablecoin for interbank settlements and international transfers. To this end, the Central Bank is developing cooperation with other banks in other countries, in particular Indonesia, Thailand and Singapore. Several major Philippine financial institutions are participating in the wholesale CBDC testing.
However, the central bank is not going to launch a digital Philippine peso for retail users anytime soon. The regulator expects that in the long term, every person living in the countries of the Association of Southeast Asian Nations could use the state stablecoin for payments using a regular phone. The regulator’s reluctance to explore a retail CBDC stems from a fear that it will not be in demand among Filipinos, as the payments industry is already oversaturated with multiple fintech platforms offering multiple payment options.
BSP announced that the number of digital payments in 2021 increased by 30% due to restrictions due to the pandemic. In 2023, the regulator plans to transfer about 50% of all transactions to a digital basis and increase the number of users with a bank account to 70%. To speed up the initiative, the Philippine central bank plans to launch InstaPay Debit PUll and Request to Pay payment services.
A few months ago, the Central Bank of the Philippines said that stablecoins can also improve the efficiency of payments and settlements, but for this it is necessary to develop competent regulation.
Source: Bits
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