BSP: Satellite tech to widen financial services

THE liberalized access to satellite technology in the country could widen the reach of financial services, according to the Bangko Sentral ng Pilipinas (BSP).

Bangko Sentral ng Pilipinas Governor Benjamin Diokno (The Manila Times file photo)

In an online briefing on Thursday, BSP Governor Benjamin Diokno said the non-enfranchised but registered internet service providers and value-added service providers can now directly access satellite systems to build broadband facilities, following the signing last March 10 of Executive Order (EO) 127 titled “Expanding the Provision of Internet Services through Inclusive Access to Satellite Services.”

He added EO 127 promotes competition by allowing more players in the internet services market. With competition, the cost of internet services will be lower and its quality will be improved.

The EO is expected to promote investments in the satellite broadband market, particularly in rural areas, Diokno continued.

“With enhanced countryside connectivity, we see previously unserved and underserved areas being reached by digital financial services, especially those designed for the lower income segments, like remittances, bills payments and the opening of transaction accounts,” he also emphasized.

Citing the central bank’s 2019 Financial Inclusion Survey, Diokno noted that internet access penetration in the country is quite uneven— 60 percent in Luzon, 40 percent in the Visayas, and 30 percent in Mindanao.

“With EO 127 in place, we expect to bridge the digital divide in the country as it enables the deployment of infrastructure for areas that are currently unserved or underserved by incumbent providers,” he also pointed out.

The BSP chief said satellite technology is best suited for rural areas where setting up terrestrial infrastructure is not economically justifiable. The new regulation also potentially optimizes the use of the 14 satellites covering the Philippines to connect all parts of the country in the shortest time possible.

leveraging on liberalized access to satellite technology, he added, banks and other financial service providers in remote areas may now be able put up more access points such as automated teller machines, cash agents, and branch lite operations. They can also offer digitalized payment transaction services accessible via the internet.

“These developments will contribute towards the BSP’s financial inclusion targets, namely that first, 70 percent of the adult population should own a transaction account, and second, that half of all retail payments should be in digital form by 2023,” Diokno stressed.