BSP bats for stronger, 'digitalized' post-pandemic economy

Jessica Fenol, ABS-CBN News

Posted at Apr 26 2021 02:24 PM

MANILA - The Bangko Sentral ng Pilipinas is working with the government not just in terms of pandemic recovery but also in building a stronger and "digitally advanced new economy", the central bank's chief said Monday.

"We do not simply aim to recover, in the post-COVID era, we want to be stronger, more technologically advanced and more inclusive than ever before," BSP Governor Benjamin Diokno said during the virtual pre-SONE economic forum. 

Digitalization efforts have gained "good progress" over the years, Diokno said. 

The total number of Filipino adults with financial accounts has grown to 28.6 percent in 2019 from 22.6 percent in 2017, he said. 

Under the BSP's digital payments transformation road map, the central bank is aiming to have at least 70 percent of Filipino adults have a financial account. 

The central bank chief earlier said digitalization has kept the economic gears running, while most businesses were shut during last year's lockdown. 

Volume of financial transactions also rose to 18 percent in the first half of 2020 from just 1 percent in 2015, he added.

InstaPay and PESONet transactions have also grown during the COVID-19 pandemic, especially when the hard lockdown was imposed last year confining millions of Filipinos in their homes.

"Financial digitalization has helped most of us adapt to these changing and challenging times. Fruits of this advocacy have become a survival tool during the lockdown and enabled us to continue transactions in the safety of our homes," Diokno said. 

"With the efforts of financial digitalization and financial literacy combined, we are setting the stage for a new Philippine economy," he added.

InstaPay or real-time online fund transfer of up to P50,000 and PESONet for transactions of bigger volumes are part of the BSP's National Retail Payment System.

Diokno said inflation is likely to breach the upper band of the government's 2 to 4 percent target range this year before settling back to 2.8 percent in 2022. 

Exports and imports are also expected to rebound, growing 8 and 12 percent, respectively, he said. 

Remittances are likely to grow by 4 percent as well as net inflows for foreign direct investments which are expected to rise to $7.8 billion this year, he added.

Gross international reserves (GIR), which grew to $110 in 2020, are expected to grow to $114 in 2021, the BSP said. 

In the same forum, Socioeconomic Planning Secretary Karl Kendrick Chua said digitalization would also help speed up financial inclusion goals and pave the way for faster distribution of COVID-19 vaccines as well as social amelioration using the national ID system. 

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