I. What is PhilPaSS?
PhilPaSS is the acronym for Philippine Payment and Settlement System, a real time gross settlement (RTGS) system owned and operated by the Bangko Sentral ng Pilipinas (BSP) that processes and settles interbank high value payment transactions of banks through the demand deposit accounts of the bank maintained with the BSP.
RTGS is a fund transfer system where transfer of money or securities takes place from one bank to another on a real-time and on gross basis. Settlement in real time means that payment transaction does not require any waiting period. The transactions are settled as soon as they are received/entered/processed into the system. Gross settlement means the transaction is settled on one to one basis without netting with any other transaction. Once processed, payments are final and irrevocable.
II. How PhilPaSS Operates?
- At the start of day, before 9am, the system extracts the beginning balances of the banks DDA from the Core Financial Accounting System (cFAS) of the BSP. cFAS is the accounting system of the BSP where the Demand Deposit Account (DDA) ledger of the banks is maintained.
- After extraction, the system status will be opened and ready to receive electronic payment instruction messages from the participating banks. Banks can send their electronic payment instruction message via SWIFT, Participant Browser or thru a 3rd Party Payment System Providers.
- Upon receipt of the electronic payment instruction message, the PhilPaSS Central Accounting System (CAS), the main application on the system, will process the settlement instructions from participants; and prompt the accounting and recording of these transactions to the participants’ DDA with BSP.
- PhilPaSS sends confirmation notices to the affected banks after the transactions have been debited and credited to their respective DDAs.
- PhilPaSS automatically stops receiving electronic payment instruction messages from the participating banks at 5:45pm. PhilPaSS will generates the ending balance of the DDA of each bank and transfer the details of the transactions in cFAS for posting to the banks’ ledger.
III. How do PhilPaSS participants communicate with PhilPaSS?
The communication link by the participants to the BSP’s CAS for the transmission of their payment instructions are either through the following linkages:
- SWIFT - stands for Society for Worldwide Interbank Financial Telecommunication. It is a secure, dedicated, global communication network that supports a range of financial messaging services including FIN, its core store-and-forward message processing service. The service provides financial institutions with a wide range of message types for fast, secure transaction and information processing and settlement. SWIFT enables the participants to transmit their financial transactions to their counterparties electronically. PhilPaSS participants are required to enroll to SWIFT FIN Copy Service to allow them to transmit directly their payment transactions to BSP’s LCSS/CAS for processing and settlement.
- PhilPaSS Participant Browser (PPB) - is a web-based facility which enables PhilPaSS participant-banks to efficiently manage their respective DDAs maintained with the BSP by: (1) allowing the banks’ designated users to check and verify the status and details of all incoming and outgoing transactions; (2) allowing designated users to re-prioritize or cancel queued payments; (3) allowing users to generate reports on-demand in various file formats; and (4) enabling banks to transmit their financial transactions to their counterparties through the BSP’s LCSS/CAS.
- 3rd Party System Providers – is an in-house developed system that is used to validate the accuracy, completeness and authenticity of the data files/batched transactions sent by other systemically important payment systems namely: Check Clearing System of PCHC, ATM Network System of Bancnet, Registry of Scripless Securities System of Bureau of Treasury and PDS Settlement Highway of the PDS Holdings Group, to PhilPaSS for processing and settlement.
- Other BSP Internal System that interface with CAS such as cFAS, eRediscounting System, Treasury Accounting System, Electronic Cash Withdrawal System, Foreign Loan Application Registration System, etc.
The PhilPaSS Primer (PDF file, 411 Kbs)