BSP: Around 40 percent of Philippine banks on schedule with digitalization efforts

The Bangko Sentral ng Pilipinas said 39.3 percent of Philippine banks are on schedule with their digitalization timeline.

File photo: PayMaya

Around 40 percent of Philippine banks on schedule with digitalization efforts

According to a report by GMA News Online, there is also 27.3 percent that is still in the planning stage and has yet to start its digitalization efforts, according to the results of the Banking Sector Outlook Survey.

BSP said quarantine restrictions implemented due to the COVID-19 pandemic contributed to accelerating the transformation in the industry.

As a result of the community quarantine restrictions in the country, the digital transformation of the banking system was accelerated with the significant increase in the use of digital payments and electronic money platforms, it said in a statement.

Broken down, the central bank noted that some 63.4 percent of universal and commercial banks and 42.9 percent of thrift banks are still on time with their schedule.

Some 47.3 percent of rural and cooperative banks are in the planning stages, it added.

Respondents said the biggest challenges they are facing towards achieving digitalization are insufficient in-house skills, lack of the right technology and tools, and over-reliance on legacy technology, the BSP noted.

Other issues that banks encounter include the tendency toward short-term thinking over long-term planning, and the lack of budget and appropriate data governance.

Meanwhile, BSP also reported that 22.7 percent of banks are behind their digitalization schedule, 2.7 percent are ahead, 5.3 percent have yet to start and have no plans to digitalize, and 1.3 percent have always been fully digital.

Earlier, the BSP allowed the operation of six digital banks. These are GoTyme Bank Corp., Maya Bank Inc., Overseas Filipino Bank Inc., Tonik Digital Bank Inc., UnionDigital Bank Inc., and UNObank Inc.

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Source: GMA News Online