BSP's PhilPaSS transactions jump 54% to P147.8T

MANILA, Philippines - The total value of financial transactions that passed through the central bank’s Philippine Payments and Settlements System (PhilPaSS) surged 54.4 percent in the first quarter of the year on the back of robust remittances from overseas Filipino workers (OFWs) and due to improved economic activities in the country, the Bangko Sentral ng Pilipinas (BSP) reported yesterday.

Data released by the BSP showed that the value of financial transactions handled by PhilPaSS reached P147.81 trillion between January and June this year or P52.11 trillion more than the P95.7 trillion handled by the system in the same period last year.

Likewise, the volume of transactions jumped 36.7 percent to 547,130 in the first half of the year from 400,220 in the same period last year.

PhilPaSS is an online and real-time gross settlement payment system administered by the central bank to facilitate payment transactions between banks. The large value handled by the system represents money in circulation that is being repeatedly processed by banks.

The BSP said the increase in the number and volume of transactions stemmed mainly from OFW remittances transactions processed and settled through the PhilPaSS Remit system.

It pointed out that the rise in the volume of transactions was due to the increase in the following transactions: overseas Filipino remittances coursed through the PhilPaSS-REMIT system, interbank lending or payments, Intraday Liquidity Facility (ILF) availments or repayments, sales and purchases of government securities via Delivery versus Payment (DvP), e-DvP transactions, and cash withdrawal from banks.  

The increase in the total transaction value was due to the 36.7 percent increase in cash withdrawals from banks, the 0.5 percent rise in remittances via the PhilPaSS-Remit, and the 36.9 percent increase in reverse repurchase and special depository accout transactions of the BSP.

Other factors include the the 24.7 percent rise in the sales and purchases of government debt papers, the 21.5 percent increase in loan transactions as well as the 16.5 percent rise in the revenue collections of the Bureau of Internal Revenue (BIR) and the Bureau of Customs thru Electronic Fund Transfer Instruction System (EFTIS).

The PhilPaSS-Remit system is part of the advocacy of the BSP to help Filipinos abroad and their beneficiaries by providing a safer, faster, and cheaper means of remittance. The project is one of the initiatives undertaken by the BSP in coordination with the Association of Bank Remittance Officers Inc. (ABROI) through a memorandum of agreement (MOA) in December of 2009 but was implemented in the second quarter of last year.

The BSP has encouraged banks and financial institutions to course OFW remittances through the central bank’s electronic payment and settlement system so that beneficiaries of Filipinos working abroad could enjoy lower fees.

The BSP said the settlement of OFW remittances through the PhilPaSS Remit System would result in savings of between P100 and P500 per transaction as current system charges between P150 and P550 per transaction. OFW families are expected to save at least P92 million to as high as P922 million due to the faster and cheaper delivery of remittances to the beneficiaries at a lower rate of P50 per transaction instead of the current range of between P100 and P550 per transaction.

The value of PhilPaSS transactions inched up by 9.6 percent to P206.6 trillion last year from P188.5 trillion recorded in 2009 due to the increase is the number of processed and settled transactions.