The Philippine Central Bank intends on rolling out the ‘CBDCPh’ soon.
BSP intends on leveraging CBDCs to improve upon financial inclusion.
The Bank also plans on enabling cross-border CBDC interoperability for economic benefits.
In an announcement, the Governor of the Bangko Sentral ng Pilipinas (BSP) – Central Bank of Philippine – Benjamin E. Diokno, shared the country’s plans regarding CBDCs.
Central Bank Digital Currencies (CBDC) have been a rapidly developing digital asset class globally. Even the governments against the use of crypto are keen on pursuing CBDC development.
Philippine Joins the Mix
Governor Diokno stated that as the interest in CBDCs continues growing throughout the world, the Philippines has also been keeping up with it.
After the Bank initiated an exploratory study for the same in 2021, it has analyzed several angles concerning CBDC’s implementation.
Investigating the nature and implication of CBDC on the whole financial system also enabled the Central Bank to gain more knowledge on how to tackle it.
Assessment of the national payment system also provided valuable information on the most appropriate uses of digital currencies. Through the CBDCs, BSP will be improving the national payment system’s efficiency, safety, and resiliency.
Iterating on the same, Governor Diokno stated,
“As next step, the BSP targets to roll-out in the near term, a pilot CBDC implementation which we call Project CBDCPh. The project aims to build organizational capacity and hands-on knowledge of key aspects of CBDC that are relevant for a use case around addressing frictions in the national payment system.”
Furthermore, using CBDCs, the Philippines intends to improve the state of financial inclusion and make it cheaper and universally accessible. Diokno added,
“Cross-border money transfers is also another financial inclusion area that CBDCs can be highly relevant. Remittance costs continue to average globally at 6.5% of the amount sent, considerably way above the 3% target of the UN Sustainable Development Goals (SDGs). Interoperability of CBDC between jurisdictions could provide substantial benefits for remittance-receiving economies, such as the Philippines, by reducing reliance on costly correspondent banking networks.”
Also acknowledging the technological and legal challenges of CBDC, Diokno stated that CBDCs might be an idea whose time has come.
Crypto in the Philippines
While cryptocurrencies aren’t considered legal tender in the country, an entity can provide services, but they must be registered with BSP.
With their CBDCPh, the Philippines will plant itself as an equally leading country in technology and adoption. As it is, many major countries are on the verge of adopting CBDC themselves, including India, Japan, Zimbabwe, and Russia.
This article was originally posted on FX Empire