November 8, 2017 — Wednesday — JuanTax attended the official launch for PESONet, the Philippine’s first ever ACH (Automated Clearing House) system to be formed under the National Retail Payment System (NRPS) framework, which would hopefully provide a much faster, safer and convenient mode of payment for Filipinos.
It is Truly About Time
The Philippine EFT System and Operations Network or simply known as “PESONet” was unveiled by the Banko Sentral ng Pilipinas Governor Nestor Espenilla Jr. during its launch at the BSP Headquarters in Manila. It was attended by the heads and national government agency officials, as well as Philippine Payments Management, Inc. (PPMI) Chairman Mr. Justo Ortiz, along with other leaders in the banking and payment industry sectors and representatives from the United States Agency for International Development (USAID).
Kicking off the event was a keynote from Espenilla, where he cited the 2015 Philippine diagnostic conducted by the Better than Cash Alliance, stating that only 1% of retail payments by volume are being paid electronically, and that the main challenge for them is how to improve this ongoing problem within e-payments.
The BSP’s main goal is to transform the payment system and raise its percentage of electronic retail payments by 20% by the year 2020.
Simply put, PESONet is one of central bank’s strategies when it comes to modernizing the retail payment system and increase adoption of e-payments within the country.
What is PESONet?
PESONet is an electronic fund transfer (EFT) payments system which would allow individuals and non individuals to transfer funds digitally to any bank included within the network.
With PESONet, you don’t need to wait for several days just to send and receive money, for funds would become available in one’s account upon clearing or within the same banking day. It’s also expected that recipients would get the money transfer in full, while as for senders, they will be charged with a minimum fee depending on their financial institution.
This new innovation would allow businesses, government sectors and individuals to be able to do digital transfers to the accounts included within the list of BSP Supervised Financial Institutions (BSFIs), as supervised by the central bank’s implementing policy.
As of now, there are 33 financial institutions from different sectors such as universal, rural, thrift and Non-Bank Electronic Money Issuers (NB-EMIs) who signed up as participants for PESONet.
Here are some of the financial institutions that were now part of the system:
- Bank of the Philippine Island (BPI)
- Land Bank of the Philippines (LandBank)
- Development Bank of the Philippines (DBP)
- Banco de Oro Unibank Inc. (BDO)
- Bank of Commerce
- China Bank Savings
- Eastwest Bank
- Rizal Commercial Banking Corporation (RCBC)
- Metropolitan Bank & Trust Company
- Union Bank of the Philippines
- Philippine National Bank (PNB)
Benefits of PESONet
Some of the known benefits of PESONet are the following:
- Payment convenience for individuals, as well as public and private businesses
- Effective budget management for government sectors
- Practical Method of handling retail payments between B2B and C2B transactions
- Small players such as rural financial institutions, as well thrift banks can also have the chance to participate with this system
We’re Getting There
One of the biggest benefits that we could see with this innovation is that not only it will enable faster payments for retail, but it would also pave the way for individuals and businesses on easily paying taxes and other fees with tax and financial sectors such as Department of Finance (DOF) and Bureau of Internal Revenue (BIR).
We truly believe that this vision of the BSP of “Empowering ACH payment systems for end users” and using today’s technology to govern payments is a good starting point in modernizing not only the retail system, but also the way government sectors handle processes such as finance, budget as well as taxes.
Having this kind of system would bring much ease when it comes to payment of taxes within the country, and we’re one step closer on fostering this new innovation within our tax software, so stay tuned!