The Bangko Sentral ng Pilipinas (BSP) and Germany’s Bundesdruckerei GmbH, a government banknotes printer, will collaborate on improving digital payment infrastructure and security features of bills.
BSP and Bundesdruckerei GmbH committed to these goals through a memorandum of understanding (MoU) which will remain effective for five years. The MoU was signed by BSP Governor Eli Remolona Jr. and Bundesdruckerei GmbH Chief Financial Officer Christian Helfrich on 10 October at the BSP Main Office in Manila City.
“BSP is proud to partner with Bundesdruckerei, a leader in providing modern currencies to the world, at a time when banknotes should be more secure, more durable, and even more sustainable,” Remolona said in a statement released Thursday.
The two institutions will be exchanging insights on technologies and legal matters about currency production and management, including authentication and verification of banknotes.
Aside from banknotes, the German institution will be sharing knowledge on modern digital infrastructure and digital payments, along with staff training.
Efficiency, sustainability
Last year, BSP-issued 1,000 polymer banknote was named the “Best New Banknote” by High Security PrintingTM Asia.
The award body lauded the Philippine bill’s more than 10 sophisticated security features ranging from the banknote’s textures to Filipino symbols.
BSP has also reached out to plastic manufacturers to implement recycling of polymers.
In terms of digital payments, BSP is exploring Central Bank Digital Currency or CBDC to ease large-amount fund transfers between institutions.
CBDCs are equivalent to the same amount of the physical currency units and are being used by more countries to replace cash payments and assets.
Global market analyst McKinsey said the European Central Bank found 10 percent of households in six countries in the European Union own digital assets and reduced cash usage in the region by one-third.
For consumers, BSP joins Southeast Asian central banks in building Nexus, a single instant payment system seen to speed up transactions and reduce their costs. Singapore’s Bank for International Settlements General Manager Agustin Carstens said Nexus can benefit 1.7 billion people.
BSP also announced it will start accepting applications for four more digital banks in the country on 1 January, while the government and businesses improve internet connectivity and more Filipinos use financial mobile apps.
BSP Deputy Governor Mamerto Tangonan said digital transactions accounted for 52.8 percent of all monthly retail payments last year, exceeding the BSP target of 50 percent for the period. The total transaction value reached P6.1 trillion.
By 2028, BSP expects expansion of digital retail payments to reach 70 percent.
