Philippines Fuels Fintech Ambitions With Blockchain-Powered Digital Banking ID Facility
A partnership between the Bankers Association of the Philippines and Amihan Global Strategies is enhancing digitization in the country’s financial services sector
PHOTO CREDIT: Getty Images
The digitization of the Philippine banking sector is taking a more serious turn.
Last November 17, the Bankers Association of the Philippines (BAP) announced its collaboration with technology consulting company Amihan Global Strategies and blockchain collaborative organization Hyperledger in establishing an industry-wide facility that will further enhance the country’s digital identity technology.
The project, which garners the cooperation of the BAP’s 41 member banks — 21 of which are local, and 20 are foreign bank branches — is set to revolutionize validation processes in the banking industry.
The Philippines, through this development, will be among the first few countries in the world to employ a powerful and sophisticated technology for identity management. Says BAP President Nestor Tan, “We are committed to pursuing the Philippine banking roadmap crafted by the BAP with the support of the Bangko Sentral ng Pilipinas (the country’s central bank). This initiative will enable the banking industry to provide a more convenient and faster way of delivering banking services to the clients.”
Centered on “self-sovereign identity,” the facility will enable an individual to have the sole control and discretion of sharing his personal information to his chosen recipients. Leveraging the platform enables the onboarding process of clients to be easier and more efficient as the individuals themselves. Through participating banks and accredited agents, they would be able to upload personal information immediately through mobile phones. Once the uploaded information is validated and vetted by a participating bank, clients are able to open a new bank account and access banking services of other participating banks easier and faster.
The facility is powered by Hyperledger blockchain technology, enabling a permanent and distributed ledger of transactions that cannot be tampered with.
“We welcome this development for the Philippines. The Bankers Association of the Philippines joins a global movement to benefit consumers using blockchain technology. We’re proud that the banking community is using open-source software from Hyperledger technology to enrich data privacy and finance,” says Brian Behlendorf, executive director of Hyperledger, an open source consortium hosted by The Linux Foundation.
While the project is still in development, several major banks like Asia United Bank, BDO, BPI, Citibank, East West Bank, Metrobank, and Union Bank have already signed on to accept and verify customer data on the platform. Other banks are expected to follow suit.
This movement takes the country one step closer to financial inclusion. Currently, only 44 million out of 100 million Filipinos deposit money in bank accounts. With the country’s rapid economic growth and the influx of digital technology, more Filipinos are expected to have access to financial services.
Says Winston Damarillo, founder and executive chairman of Amihan Global Strategies, “Digital is the best solution for financial inclusion in the Philippines. We are excited to collaborate with BAP and Hyperledger to deliver inclusive innovation to Filipinos.”
Behlendorf, who was in the country last week to launch the Philippines’ first-ever Blockchain Week, concurs. “Ultimately, blockchain technology is about building distributed, more accountable, and more open transaction networks and services. This will benefit companies and even everyday people. With Amihan’s partnership, we are excited to see new blockchain-based ASEAN solutions that will revolutionize the region, and the entire digital world.”