Philippines Financial Sector Assessment Program : Philippine Payment and Settlement System
The Philippine payment, clearing, and settlement infrastructure consists of systemically important financial market infrastructures and retail payment systems. The Philippine payment and settlement system (PhilPaSS) was implemented in 2002 and is o...
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| Format: | Report |
| Language: | English |
| Published: |
World Bank, Washington, DC
2021
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| Online Access: | http://documents.worldbank.org/curated/en/539271629267802196/Philippines-Financial-Sector-Assessment-Program-Philippine-Payment-and-Settlement-System-Technical-Note http://hdl.handle.net/10986/36186 |
| Summary: | The Philippine payment, clearing, and
settlement infrastructure consists of systemically important
financial market infrastructures and retail payment systems.
The Philippine payment and settlement system (PhilPaSS) was
implemented in 2002 and is operated by the payments and
settlements office (PSO) of Bangko Sentral ng Pilipinas
(BSP) and the oversight function is with the payment system
oversight department (PSOD) of BSP. The rules and
regulations for implementation of the national payment
systems act (NPSA) have to be notified by the BSP on an
immediate basis to provide a high degree of certainty for
payment systems in Philippines, including each material
aspect of PhilPaSS’ activities. The BSP should obtain the
approval of the Monetary Board (MB) for the operations of
PhilPaSS as laid down under section 8 of the NPSA. It is
recommended that BSP issue necessary secondary legislation
under the NPSA covering the registration of payment systems.
In order to ensure that the current governance framework
adequately represents the interests of the relevant
stakeholders in PhilPaSS, BSP may take suitable measures
such as considering stakeholder representation in the Board
Risk Oversight Committee (BROC) or in the digital payments
transformation steering committee (DPTSC) for direct
participants or alternately constitute user committees and
undertake a public consultation process. The MB should
establish a clear, documented risk-management framework that
includes the PhilPaSS’ risk policy, assigns responsibilities
and accountability for risk decisions, and addresses
decision-making in crises and emergencies. It is accordingly
recommended that: (i) the enterprise risk management (ERM)
framework to include legal risk, credit risk, liquidity
risk, settlement risk, custody risk, and reputational risk
for PhilPaSS, apart from operational risk; and (ii) consider
strengthening the BROC to enable it to also function as a
risk committee for PhilPaSS in addition to its existing role. |
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