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To reach to people who have no access to banks, the Bangko Sentral ng Pilipinas (BSP) looks into tapping third parties such as retail outlets to be conduits for money transfer through mobile phones. While considering the said option, BSP governor Amando M. Tetangco, cautioned while that the business arguments for the establishment of a vast network of authorized third parties for such service is clear, it must be balanced with the need for prudent regulations.

Tetangco, said in his speech at the Mobile Money Transfer Conference and Expo held recently, “While the business case of a vast network of authorized agent is clear, sufficient regulations must be in place to ascertain these agents comply with operational standards as well as good governance and consumer protection practices.”

He added that the central bank is currently studying the ways on how third parties such as convenience stores and pharmacies could serve as intermediaries for mobile money transfer. “Under our regulations, electronic money institutions will make sure these agents are compliant, when they are finally allowed,” he said.

In the present status quo, banks and non-banks with quasi-banking functions are the only outlets allowed to engage in electronic money transfer. The BSP acknowledges the huge potential for growth of mobile money transfer in country because of the number of cellular phone users.

“For instance,” Tetangco said, “mobile phone in RP user estimated at around 42.5 million, far more than those with bank accounts or those with existing relationship with a formal financial institution.”  “In fact, around 40% of 1,632 municipalities have no banking offices. These areas represent growth potential for mobile money transfer in terms of ensuring fast and inexpensive delivery of remittances from OFWs to their families and relatives across the Philippines,” he added.

Tetangco also stressed the cost-efficiency of mobile transactions, which beneficial both to the customers and the banks.