1. The Philippine Payments System BELLA S. SANTOS Director Payments and Settlements Office05/29/12 1
2. Outline of PresentationA. Overview of National Payments System – What is the National Payments System (NPS) – The NPS Framework – The NPS Network – The PhilPaSS – PhilPaSS Participants• How RBs Participate in PhilPaSS• The PhilPaSS REMIT System (Overseas REM)• The PhilPaSS REMIT System (Domestic REM)
3. The National Payments System • The National Payments System includes the country’s entire matrix of institutional and infrastructure arrangements and processes through which money is transferred between savers and borrowers, buyers and sellers or from one party to another party.05/29/12 3
4. Used for transacting The National Payments System provide payment accounts, instrumentsand clearing paymentinstruments, and services to consumers, businesses Frameworkprocessing and and organizations that process paymentcommunicating transactions, and provide clearing and such as conventions, regulationspayment information, settlement service networks for those and contracts for producing,and transferring the financial institutions pricing, delivering and acquiringfunds between the the various payment instruments and servicespaying and receiving FINANCIALinstitutions INSTITUTIONS PAYMENTS MARKET If financial transactions INFRASTRUCTURE are the lifeblood of the ARRANGEMENTS economy, then payment system is the circulatory set by legislators,Used to initiate system that enables the courts andand direct the smooth flow of these regulators thattransfer of transactions define and governfunds between the mechanics ofthe accounts NATIONAL the paymentof payers and transfer processpayees at PAYMENTS SYSTEM and the conduct offinancial payment serviceinstitutions markets LAWS, RULES , PAYMENTS STANDARDS & INSTRUMENTS PROCEDURES
5. THE PHIL PAYMENTS SETTLEMENTS SYSTEM BSP LIQUIDITY TOOLS: o INTRADAY LIQUIDITY o RP KBs FACILITY o EMERGENCY LOAN OFW REMITTANCES o OVERDRAFT CREDIT LINEoINTERBANK FUND SWIFT PhilPaSS TRANSFERS REMITo HIGH VALUE CUSTOMER FX TRADES PAYMENTSo REMITTANCE OF PhilPaSS BIR TAXES/BOC CUSTOM DUTIES TO BTr DvPo CASH WITHDRAWALS PPS- THIRD FR BSP CASH DEPTo SDA/RRP FES PARTY ATM NETWORKS SYSTEM BSP eDvP/REPO TBs/SBs INTERNAL RBs/ SYSTEMS CHECK CLEARING NBQBs o cFAS o SFCS o IRIS o eREDISCOUNTING o COCAS
6. Who are the Participants of PhilPaSS05/29/12 6
7. Rural Banks Participating in PhilPaSS05/29/12 7
8. Benefits for RB’s Membership in PhilPaSS Facilitate Deposit For BSP Reserve Requirement Electronic Purposes Crediting of Management of Proceeds from DDA Balance E-Rediscounting Serve as Direct to DDA Settlement Bank On OFW /Domestic Remittances Facilitate Electronic Transfer of Excess Payment of DDA Funds to Maturing Loans Account in KBs Facilitate Interbank Fund Transfers05/29/12 8
9. HOW TO PARTICIPATE IN PHILPASS?
10. PhilPaSS Roving Team• Considering the geographical locations of the rural banks, the Payments and Settlements Steering Committee, the policy making body on payments and settlements, created the PhilPaSS Roving Team (PRT).• This team is tasked to reach out to rural banks and thrift/savings banks located outside of Metro Manila that are not yet member of PhilPaSS.
11. Services rendered by the PhilPaSS Roving Team (PRT)• Process and approve PhilPaSS Participation Documents on-site• Install the PPS-FES Client Software in the RB’s official PCs on-site• Train RB’s authorized users of PhilPaSS. Authorized PhilPaSS Users include bank’s operations and IT personnel
12. How to avail of the PRT Services?• Send a Letter of Invitation expressing interest of the rural banks in your federation to avail of the services of the PhilPaSS Roving Team to: Atty. Juan D. De Zuñiga, Jr. Deputy Governor Resource Management Sector and Security Plant Complex & Concurrent General Counsel• Arrange a venue for the PhilPaSS Roving Team one-stop shop.• Coordinate with your Federation-member banks to submit the documentary requirements for PhilPaSS membership. Forms are downloadable from BSP website: www.bsp.gov.ph, [please click Payments and Settlements/Philippine RTGS: PhilPaSS/Forms Items I and II B (PPS-FES Users –Non-SWIFT)].
13. How to avail of the PRT Services?• Inform the member-banks to bring their official PCs or computers for PPS-FES Software installation and send at least two (2) authorized users and one IT personnel to attend the user training.• After the approval of each rural bank’s membership, installation of the software and training of users, the banks will only be able to commence transacting business with PhilPaSS after the approval of the Users Acceptance Testing Form and the generation of the passwords of the banks’ authorized users which will be processed at the BSP Head Office.
14. REQUIREMENTS FOR MEMBERSHIP IN PhilPaSS Certification Signed Letter of as accredited PhilPaSS Application member of the Participation RBAP Agreement Signed System List of Officers Dial-Up Certification authorized to sign the Registration Checklist duly PhilPaSS transactions Form approved by the BSP’s ITSS05/29/12 14
15. Invitation For the Ilo-Ilo, Aklan & Capiz Federation of RBs• The PhilPaSS Roving Team will conduct the One-Stop-Shop Forum at the BSP Roxas City Branch on 8 June 2012.• PhilPaSS Application Kit can be obtained from the PhilPaSS Booth located near the RBAP Secretariat. The Kit contains all the documents needed to be accomplished and submitted at the PRT One-Stop-Shop Forum at the BSP Roxas City Branch for evaluation and approval• Please inform the PSO that you will be attending the forum on or before 28 May 2012 by sending us email at email@example.com or at firstname.lastname@example.org or you may call PSO at (02) 400-7071
16. The PhilPaSS One-Stop-Shop Forum• In the PhilPaSS One-Stop-Shop Forum, the PRT will evaluate and approve your PhilPaSS participation documents, so before coming to the Forum, be sure that all the documents are complete.• The participating banks need to bring at the Forum their official PC/laptop where the PPS-FES Client System will be installed.• The participating banks need to send two (2) PhilPaSS users and one IT personnel for the PhilPaSS training. A Users Acceptance Test Form will be signed by the participants which will be used as basis for the generation of their PASSWORDS. Generation of the passwords will be done at the BSP Main Office and will be sent to the participants thru registered mail.
17. The PhilPaSS REMIT System (Overseas Remittances)05/29/12 17
18. PhilPaSS REMIT Participants – as of Jan. 20121. Allied Banking Corp.2. Asia United Bank New Participants3. Banco de Oro Unibank 1. Philippine Veterans Bank4. Bank of the Philippine Islands 2. Al Amanah Bank5. China Bank 3. Philippine Bank of Communications6. Development Bank of the Phils. 4. First Consolidated Bank7. Land Bank of the Philippines 5. East West Bank8. Metrobank9. Philippine National Bank10. Rizal Commercial Banking Corp.11. United Coconut Planters Bank12. Philippine Savings Bank
19. PhilPaSS REMIT Status Update PARTICULARS 2011 2010NO OF PARTICIPANT BANKS 17 12VOLUME OF TRANSACTIONS 320,845 112,638VALUE OF TRANSACTIONS P12,629,064,648 P4,003,799,184
20. OFW Remittances via PhilPaSS - REMIT ABROI Features: ABROI Branch/ Bank (A) in the Remittance - Rules are covered by a MOA Philippines between BSP, BAP, CTB, RBAP Partner Abroad and ABROI, - Same day Bank-to-Other-Bank settlement - Lower costs BSP-PhilPaSS - Effective feedback mechanism - Safe and smooth operations OFW Beneficiary Account with Bank B Funds Transfer from ABROI Bank A to Bank B
22. Remitting Bank PhilPaSS CAS 4 Checks if remitting/sending bank has sufficient DDA balance (9:00AM-5:45PM); debits its DDA and credits the DDA 5 Sends Mainframe of the beneficiary/receiving Settlement bank. Status BSP Network 3 Sends summarized 7 transactions to PhilPaSS- Remitting/sending CAS for settlement. bank retrieves Reply File1 Remitting/Sendingbank sends 6 Generates Reply File withtransactions (Input Settlement StatusFile) from9:00AM-3:00PM. 2 System validates transactions. Summarizes valid transactions per REMIT Gateway PhilPaSS beneficiary/receiving bank. Server Server
23. PhilPaSS REMIT SYSTEMBeneficiary/ Receiving Bank (After Processing & Settlement of Remittances)
24. 3 Receiving Bank posts transaction to the account of Beneficiary/Customer. PhilPaSS Server1 BSP processes 5 BSP generates Report on OFWsettled transactions remittances (Annex 2) after 4:00PMand creates the following banking day; sends toBeneficiary File (per Gateway Server for information ofReceiving Bank); remittingsends file to Gateway bank. Receiving BankServer. (9AM-5:45PM) 4 Receiving bank updates Beneficiary file with Posting Time Stamp, if posted. If not posted, indicate reason. (up to 4:00PM the following banking day) BSP Network 2 Receiving Bank retrieves REMIT Gateway Server Beneficiary File
25. Timelines • The Remitting Bank can send as many files to PhilPaSS from 9:00 am to 3:00 pm. • The PhilPaSS processes and settles the files sent by Remitting Bank and provide feedback of the status of settlement within 5 seconds. • Details of all transactions settled will be sent to the Beneficiary Bank for credit to the accounts of the ultimate beneficiaries on the same day.05/29/12 25
26. Feedback Mechanism • Upon credit to the account of the ultimate beneficiary, the Beneficiary bank will submit to BSP status of each transactions. • For unposted transactions due to invalid acct number, closed or dormant account or other erroneous parameters, the Beneficiary bank is given up to 4:00 pm the next banking day to submit status of the transactions and return the corresponding money to the remitting bank. Failure to submit updates will be subject to penalty for every day of delay.05/29/12 26
27. Fees • The participating banks will set the Front-end fees to be collected by the Remitting bank from the remitter. • BSP-PhilPaSS will charges the bank a P5.00 transaction fee for each remittance transaction. • The banks agreed (as indicated in the MOA) that a standard rate of P50.00/transactions will be collected by the Beneficiary Banks as back-end processing fee.05/29/12 27
28. The PhilPaSS REMIT System (Domestic Remittances)05/29/12 28
29. DOMESTIC REMITTANCES PROPOSED TRANSACTION FLOW & FEEDBACK MECHANISM DIAGRAM Remitting Banks Remitting Banks – are banks that receive remittances from the remitter. These could be commercial banks, thrift banks or rural banks. BSP PhilPaSS Transactions may originate from Metro Manila or from the provinces, cities Feedback mechanism – requires that participating beneficiary banks need to or municipalities. send status to PhilPaSS of the time the remittance has been credited to the beneficiary’s account. Failure of the beneficiary bank to send said status, the system will automatically debits back the bank for the remittance. Beneficiary Banks – are the banks Beneficiary Banks where the remittances are credited and where the Beneficiaries beneficiaries maintain accounts. Account
30. DOMESTIC REMITTANCES PROPOSED TRANSACTION FLOW Remitting Bank BSP-PhilPaSS REMIT System Beneficiary Bank 8.Upon posting of the file of remittances for deposit to other banks by the remitting banks, the system 4. Upon notification that1. Extracts from its records aggregates the records by beneficiary its DDA has been credited,domestic remittances for bank and settles the transactions by the Beneficiary bank,deposit to other banks and debiting the DDA of the Remitting Bank downloads from the REMITtransmit the file to the BSP- and crediting the DDA of the gateway the details of thePhilPaSS REMIT gateway . Beneficiary Bank. depositors/ beneficiaries 3. The REMIT System creates for further crediting of7. The Remitting Bank, the Beneficiary file for each of the their accounts.upon receipt of the banks credited in the BSP-REMITnotification from the BSP, gateway. 5. The Beneficiary bankwill inform the remitter that sends Status Report to thethe remittances have been 6. The BSP-REMIT, upon receipt of the BSP-REMIT gateway once it Status Report will notify the Remittingreceived by the has credited the account of Bank that the remittances have beenbeneficiaries. its depositor/beneficiary. received by the beneficiaries