MANILA, Philippines—An improved version of the system used to electronically settle payments locally—made more important by the pandemic—has now gone “live,” allowing more transactions with greater security.
In a statement, the head of the Bangko Sentral ng Pilipinas (BSP) said PhilPaSSplus, the country’s next-generation peso real-time gross settlement (RTGS) system, is in full operation.
“Equipped with advanced features, PhilPaSSplus is a key milestone in our continuing efforts to have an efficient, secure and inclusive digital settlement platform for both large value and retail payments,” BSP Governor Benjamin Diokno said.
A payment system is a mechanism composed of rules, institutions, people, markets and organizations that make exchanges of payments possible. A real-time gross settlement system is a platform that enables the large-value transfer of funds between banks in real time. It is now being offered by most commercial and thrift banks to their clients as alternative to check payments.
According to Diokno, the new PhilPaSSplus can settle higher volumes of payment instructions at faster speed compared with the older RTGS system that the BSP has decommissioned.
By accepting only the globally prescribed ISO 20022 payment messaging standard, PhilPaSSplus enables the country to integrate with both domestic and cross-border payment ecosystems. The new system also provides more access channels for participating institutions, stronger security features and richer payment information.
PhilPaSSplus forms part of the BSP’s digital transformation initiatives, which entail leveraging on emerging technologies to expedite payment services that have become a necessity in these extraordinary times.
The project has come to completion with the support of the participants of the RTGS system and their associations. More than 170 financial institutions—mostly banks—use the BSP-operated PhilPaSSplus to settle their clients’ ATM, InstaPay, PESONet and check transactions.
By facilitating the movement of money through digital fund transfers, the PhilPaSSplus is vital to the smooth functioning of the financial system and to upholding public interest.
Recently, the central bank’s policy-making Monetary Board approved the designation of the Philippine Peso Real-Time Gross Settlement scheme as a “systemically important payment system”.
This designation—the first in the country under the National Payment Systems Act—is used for payment networks which, if disrupted, could pose a systemic risk that could threaten the stability of the economy.