BSP adopts automated foreign loan approval
The Bangko Sentral ng Pilipinas (BSP) has adopted an automated system for the approval and registration of foreign loans as part of the continuing efforts to further enhance operational effi ciency and delivery of services using latest available technology.
BSP Governor Amando Tetangco Jr. said the Foreign Loan Approval and Registration System ( FLARES) would facilitate the submission of applications for approval and registration of loans via the Internet.
Currently, applications for approval and registration of foreign and foreign currency deposit unit (FCDU) loans are filed by clients in hard copies with the International Operations Department of the central bank.
Exchange of communications between BSP and clients likewise involve hard copy documents, aside from telephone inquiries and electronic messages. Moreover, payment of the related processing fee has to be done within BSP premises.
Under the new web-based system, clients could now file applications, monitor the status of their requests, and commu- nicate with the BSP from the comfort of their offices using the Internet.
Likewise, security of data transmission through the system is achieved through user account ID, digital certificate, and private identification number to be given to borrowers enrolled under FLARES.
A system- generated order of payment may also be printed anytime from clients’ authorized workstations for presentation to participating banks to settle fees due.
Payments through banks would initially involve over-the-counter transactions but use of banks’ electronic payment facilities would subsequently be offered as the banks’ own systems become fully ready.
The new system, Tetangco said, would not only improve efficiency but also increase transparency in the processing of applications, and provide clients greater convenience in transacting with the BSP.
He added that the launching of FLARES is quite timely in light of all the developments in external debt dynamics across the globe.
“While I don’t believe the Philippines is about to enter any kind of external debt crisis any time soon I believe now is a good time to take stock and be reminded of the possible consequences - both intended and otherwise - of a country’s cumulative decisions and actions with respect to debt,” he said.
Latest data showed that total FCDU loans jumped 26.5 percent to $6.565 billion as of end-september last year from $5.189 billion in the same period in 2010 as disbursements to fi nancial services as well as manufacturers and exporters increased.
FCDUS refer to units of domestic banks or local branches of foreign lenders authorized by the BSP to engage in foreign currency-denominated transactions such as accepting deposits and issuing loans.
Participating banks of the FLARES initially consist of Banco De Oro Unibank of retail magnate Henry Sy, the Ayalacontrolled Bank of the Philippine Islands, state-run Land Bank of the Philippines, and Philippine National Bank of airline and tobacco magnate Lucio Tan.