Payment systems are essential to the effective functioning of financial systems worldwide. They provide the channels through which funds are transferred among banks and other institutions to discharge payment obligations arising from economic and financial transactions across the entire economy. An efficient, secure and reliable payment system reduces the cost of exchanging goods and services, and it is an essential tool for the effective implementation of monetary policy, and the smooth functioning of money and capital markets. It is this key role played by payment and settlement systems (PSS) in the smooth functioning of an economy in general and its financial and monetary system in particular that gives the central bank (CB) a strong incentive for ensuring that an effective, reliable and secure payment and settlement system is in place.
In the Philippines, the BSP takes the lead in promoting an efficient payments and settlements system by providing:
- the necessary infrastructure through the operations of the Philippine Payment and Settlement System or the “PhilPaSS”; and
- a policy and regulatory framework, also known as the National Retail Payment System or NRPS, to establish safe, efficient and reliable retail payment system in the country.