Consumer protection is vital in digital economy, says banker | Business and Politics - video Dailymotion

The Manila Times

Consumer protection is vital in digital economy, says banker | Business and Politics  RCBC Executive Vice President Lito Villanueva talks about the Philippines’ transition into a digital economy, as well as the dangers of cryptocurrencies. He highlights the importance of consumer protection in digital payments.   Subscribe to The Manila Times Channel - https://tmt.ph/YTSubscribe   Visit our website at https://www.manilatimes.net   Follow us:  Facebook - https://tmt.ph/facebook  Instagram - https://tmt.ph/instagram  Twitter - https://tmt.ph/twitter  DailyMotion - https://tmt.ph/dailymotion   Subscribe to our Digital Edition - https://tmt.ph/digital   Check out our Podcasts:  Spotify - https://tmt.ph/spotify  Apple Podcasts - https://tmt.ph/applepodcasts  Amazon Music - https://tmt.ph/amazonmusic  Deezer: https://tmt.ph/deezer  Stitcher: https://tmt.ph/stitcher Tune In: https://tmt.ph/tunein  #TheManilaTimes #SMNIBusinessandPolitics

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00:00 the late Governor Nesting Espinilla, and now you have of course Governor Medalla, and

00:09 now Governor Elie Remolona. The whole idea is really on how we can transform the Philippine

00:15 economy to become a digital economy. And one thing that I also would want to highlight

00:24 is the fact that we have what we call the Digital Payments Transformation Roadmap that

00:28 has been set by the BSP. There are two goals under this roadmap, and that would be, number

00:35 one is to transform at least 50% of freedom financial transactions in the form of digital,

00:44 and to onboard 70% of adult Filipinos into the formal financial system by end of this

00:49 year. I think the good news is that we will be able to achieve those twin goals by end

00:54 of 2023. So I mean, definitely these are the things that we've been doing in the industry,

01:00 and of course this is not just the handiwork of the industry or the regulators. Practically

01:07 all the sectors involved, I mean all the stakeholders, including our consumers, because if there's

01:13 one thing that the pandemic brought about in terms of positive thing, I think it would

01:19 be more of how the consumers were able to embrace digital, and we have seen the accelerated

01:26 pace of consumer adoption when it comes to digital payments.

01:29 Right. Well, Secretary Jokla, when he was still with the Banco Central, was already

01:33 talking about cash, like society, and as you said, the pandemic accelerated many of those

01:39 initiatives. What is the aim here? What are the benefits? Because as I understand it,

01:48 there's this whole movement about maybe bypassing central banks, and that's how cryptocurrencies

01:53 became popular. And then we saw central banks coming up with their own digital currencies.

02:00 Is it an initiative to just catch up with what's changing in the digital landscape,

02:05 or there are actually economic benefits? Is there faster growth, for example, if you have

02:12 a digital or a cash-like society? Definitely, yeah. There are several emerging

02:17 technologies out there, right? So you talk about cryptocurrency, blockchain, Web3.0,

02:23 and in fact, the central bank, BBSP, has been pushing for what we call the CBTCPH, or Central

02:30 Bank Digital Currency Project, that is now called Project Aguila. And in fact, there

02:35 are about 12 participants there, or participating entities for this particular pilot. And in

02:42 fact, for a lot of the players in the industry, I think there are about more than 30 licensees

02:50 when it comes to digital assets. This would be what we call the VASP, or the Virtual Asset

02:55 Service Provider licensees, that is being provided by or issued by the BSP. But only

03:02 a handful would be active in the market right now. And I think you're right. While the Philippines

03:08 has been one of the top 10 countries when it comes to adoption to crypto, there should

03:15 be much attention given to consumer education, because there is so much risk there. And definitely,

03:25 we have to provide the proper education and awareness among consumers who would be lured

03:30 to make use of cryptos. That's why in the Philippine Blockchain Council, the one that

03:36 we are really advocating is on how to get rid or to weed out those bad elements, especially

03:42 those that are not really licensed, or those that are really illegal or scammers. And in

03:51 fact, a lot of Filipinos would be, some of them would be scammed because of some of this

03:59 maybe lack of awareness or lack of education. But I think one of the things that we are

04:04 also pushing here is the promotion of the use of technology for good. Because consumer

04:13 protection is one primary agenda amongst industry players on how to protect the best interests

04:23 of our consumers.

04:24 >> So one of the things that's recently in the news was, of course, the start of the

04:28 trial for Sam Backman Freed, fantastic collapse of his company. So I think going back to the

04:38 question that I had, what is the future of money? Do you think that will include cryptocurrencies?

04:44 Or are we looking at central bank digital currencies? Because the whole philosophy,

04:49 as I understand, and please correct me if I'm wrong about cryptocurrencies, is that

04:53 they're designed to bypass regulatory intermediaries like central banks, right? And I was wondering

05:00 if the Philippines, like other countries like China and others, are now introducing sort

05:07 of a substitute, right?

05:11 That they can still control, that they can still regulate, as opposed to cryptocurrencies

05:15 that really operate outside of the traditional banking system.

05:20 >> Yes, precisely, to your point, I would say that we are still in that crypto winter

05:27 stage because of the collapse of FTX and the other issues that prevailed during recent

05:35 times in terms of uncertainties when it comes to cryptos. But I think you're right. I mean,

05:42 there are practically nine or ten countries or markets in the world that are now into

05:47 CBDC or having to use stable coins, right? That's why I think, as I've said, BSP has

05:52 been very progressive when it comes to having to adopt its own CBDC and having to pilot

05:59 something that is, although it's still on a wholesale approach, right, on CBDC. But

06:04 to your question, definitely crypto will be part of that ecosystem. And while the idea

06:11 of crypto is really to disintermediate some of these entities, and of course, because

06:18 of blockchain and because of distrusted platforms, the thing is really on how we can merge or

06:25 we can blend that together in making sure that you have consumer protection, you have

06:30 consumer education, and of course, you have at least an entity that would also supervise

06:37 the actors in that particular field, right, with the end goal of really making sure that

06:43 every consumer is protected.

06:45 Let me try to provoke you a little bit here. Because in the Manila Times, you've written

06:48 a number of editorials where we have said that we better watch out on these, well, Bitcoin

06:56 and other cryptocurrencies, because frankly, many of us in the editorial board think it's

07:00 a scam, that it doesn't really qualify as money. Some people said it has no intrinsic

07:07 value and that really the way a form of money will survive is really trust in the people

07:18 that use it, right? And so now with the fantastic collapse of FTX and all of these other problems,

07:28 as you said, that's now created this crypto winter, wouldn't the future be more like digital

07:38 currencies of different countries rather than new currencies that were spawned outside of

07:45 the traditional system?

07:46 You know, it's really happening now as we speak, right? In fact, Philippines would be

07:50 among, as I've said, among the top eight even countries when it comes to crypto adoption.

07:58 And there are reports saying that about 10% of our inward remittance volume is really

08:04 being sent through cryptos. So I mean, you're now seeing some of these figures, some of

08:10 this empirical data that would tell you that indeed Filipinos are so adaptive or so, you

08:16 know, they could easily adapt to technologies. But I think to your point, I mean, the thing

08:21 is really on how we could further protect them, right? And we won't be able to see the

08:27 end of innovations. Innovations will definitely be there. More and more emerging technologies

08:34 will come out and something that, you know, our Gen Zenners or Gen Zoomers or even Gen

08:43 Alpha now would be embracing, right? So in fact, a lot of, you know, the millennials

08:51 and even Gen Z population are really into this, right? So because for them, it's really

08:57 more about having the convenience of doing their financial services through their mobile

09:02 apps.

09:03 I see. So you haven't given up on crypto.

09:06 Not yet.

09:08 Now, before the pandemic, I know the central bank was already trying to initiate some projects

09:14 to move toward that cash like society. I think they even had a pilot area in Quezon City

09:19 somewhere where people could use QR codes.

09:22 Like QR.

09:23 Yes. Yes. How do you see that being adopted? I mean, what does the rollout look like from

09:31 RCBC or from Alliance PH's standpoint?

09:35 Well, you know, as I've said, BSP has been an advocate for continuous innovation, right?

09:43 On how we can provide the banking services to the unbanked or underserved Filipinos.

09:51 And to your point, I mean, the QRPH or the interoperable QRPH has been part of the initiative

09:58 of the BSP together with the industry as way back 2017 when we launched the National Digital

10:05 Payment System. And this started through what we call what we now know as Instapay and PesoNet.

10:12 And we've seen the exponential growth of both ECHS or automated clearinghouses for real-time

10:21 small value transfers up to 50,000 which is Instapay, as well as another ECH which is

10:29 PesoNet which is the one where you could send higher value, although not yet real-time.

10:36 So the thing is that they have also rolled it out to the public markets by way of having

10:45 to educate the mass market on the use of interoperable QR. So that's why part of the initiative

10:52 of the BSP, of the PPMI, the Philippine Payments Management Incorporated, plus the other, of

10:57 course, all the stakeholders, is really to make every Filipino consumer aware that regardless

11:03 of what you're using as a mobile app could now be read or could now be used to scan any

11:11 QRPH code that you could actually see in any store, in Sari-Sari store, department store,

11:18 or any establishment for that matter, for payment of anything, right? Or for payment

11:24 of goods or services, etc. So that has been the campaign initiated by the BSP. So we actually

11:31 joined those caravans on Paling QRPH that is also being led by our also very dynamic

11:39 Deputy Governor Berna, Romuald Puyat, wherein the whole idea is really to make sure that

11:46 all the players in the industry would be able to also play a part in educating the public.

11:52 So for RCBC, we have launched what we call the RCBC Discard Tech. That was the only product

12:00 that was launched at the height of a lockdown way back July 2020. And in fact, after we

12:05 launched that, in a matter of three months, we became number one with the most downloaded

12:13 app in the country. And with that, we were able to get or to reach several regional and

12:20 global accolades. And that really resulted in having that award as being the Philippines

12:27 Best Bank for Digital for four consecutive years now from Asia Money. Of course, other

12:33 awards are coming from YouTube, from Gartner, etc. So I think the whole idea is really on

12:38 how we can really provide the necessary tools needed by our target market. It's not about

12:53 how sexy your mobile app is, how robust your platform is. It's really more having to know

12:59 the pulse of your target market, of your consumers.

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Consumer protection is vital in digital economy, says banker | Business and Politics

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