Smaller lenders ramping up digitization efforts
THRIFT LENDERS are working to further improve their digital platforms, particularly to meet the central bank’s deadline for the industry to migrate to microchipped powered cards by next year, according to the top official of the Chamber of Thrift Banks (CTB).
“I think everyone is working towards that deadline. We will check with our members in terms of how they are in meeting the deadline,” CTB President Rommel S. Latinazo said on the sidelines of the CTB’s General Membership Meeting when asked if thrift banks would be able to meet the Bangko Sentral ng Pilipinas’ (BSP) deadline of being Euro Pay, Mastercard and Visa ( EMV)-compliant by 2017.
In 2014, the BSP issued Circular 859 that required all debit and credit card- issuing companies to shift to the EMV chip technology by Jan. 1, 2017, moving away from the current magnetic stripe.
The EMV system — an international standard — is said to be “more secure” against fraud as it includes encryption locks and keys to authenticate the card and transactions, protecting data from being compromised.
“At this point everyone will check on that. If [the] BAP (Bankers Association of the Philippines) will be going for an extension, I think majority would follow,” Mr. Latinazo said.
“I will consult with our members and check on how they are doing in terms of compliance.”
In a previous interview, BAP President Nestor V. Tan said that
they “will just comply with the risk transfer” when asked whether he will request to the BSP for an extension to the deadline, meaning risks will be passed on to non-EMV-compliant entities.
Aside from the lenders’ EMV compliance, Mr. Latinazo said the thrift banking sector is gradually shifting to the digital banking platform as “digitization [is] one of the things that would define banking later on.”
“Most of our members have in fact expressed interest about the opportunities that Lendr can offer for their organization,” he added, referring to the digital lending platform Lendr.
Lendr is one of the breakthrough products developed by FINTQ.
Lito M. Villanueva, president of FINTQ, the financial technology unit of Voyager Innovations, Inc., said in his presentation during the membership meeting that “10 other banks will soon be on board” and by first quarter next year these banks will be going live on Lendr.
Mr. Latinazo noted that shifting to the digital platform is “one way of overcoming the physical challenges of a bank.”
“Digitization offers opportunities and reduces limitations as far as presence is concerned so we can reach out to more clients,” he added.
Voyager Innovations is the digital innovations arm of PLDT, Inc. and Smart Communications, Inc. Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary Media Quest Holdings, Inc., has a stake in Business World through the Philippine Star Group, which it controls.