The Philippines’ current instant payment systems are working just fine so we won’t be needing a central bank digital currency (CBDC) as of the moment, says Finance Secretary and former BSP Chief Benjamin Diokno in a press statement.
Speaking before the Senate Finance Committee to discuss the proposed $90 billion national budget for next year, Secretary Diokno answered questions about the president’s economic plans, including some about the BSP’s proposed issuance of a digital peso.
When asked whether or not the Philippines should expect a CBDC any time soon, Diokno stated that adopting a digital peso “would not be worthwhile at this point,” explaining that the country already has digital payment systems that are working well.
He pointed to PesoNet and InstaPay, two electronic funds transfer services that allow for real-time payments between banks, e-money issuers, and mobile wallets, as sufficient alternatives to a digital peso.
Diokno also confirmed that during his time at the BSP, the central bank has already conducted feasibility tests on CBDC issuance — a pilot case study focused on wholesale CBDC that sought to experiment with its usefulness on large-value financial transactions — with BSP Deputy Governor Mamerto Tangonan as project lead.
Several advisors were also put in place to manage various sectors, including Edna Villa as the payments advisor and Lilia Guillermo as the technology advisor.
In the end, he said, the central bank decided to pass up on a CBDC and “concluded that [we should first] strengthen PesoNet and InstaPay.”
Digital payments, cryptocurrency adoption now taking root in PH
The Finance secretary noted that the Philippines remains largely cash-reliant, but this, he acknowledged, is also slowly changing as digital payments take root. Mobile wallets like GCash and Maya, he said, are now filling that void.
The country now also has six fully operational digital banks which include Maya, GoTyme, and Tonik Digital Bank. He says these banks can further serve the digital payments market.
As Diokno shoots down a digital peso, Filipinos have continued to adopt digital assets and blockchain technology at a rapid pace.
A recent study conducted by Ciena (NYSE: CIEN) showed that 89% of the country’s workforce wants to spend more office time in the metaverse. The study predicts that this transition to the metaverse would be smooth for Filipinos as they have one of the world’s highest Web3 adoption rates through play-to-earn games.
In its 2022 Global Cryptocurrency Adoption Index, Chainalysis has also put the Philippines in second place in terms of cryptocurrency adoption worldwide, overtaken only by Vietnam.