Philippines’ Central Bank To Launch CBDC Pilot Program

The Philippines will launch a pilot program for a central bank digital currency (CBDC).

In a speech transcript published on March 4, the Philippines’ central bank governor announced the rollout of a CBDC project at a joint event that was organized by Bangko Sentral ng Pillipinas (BSP) and the Alliance for Financial Inclusion.

According to BSP chief Benjamin Diokno, the project aims to improve “the payment system’s safety, resiliency, and efficiency.”

Diokno also went on to highlight the potential impact of CBDCs. The BSP governor noted that a CBDC would assist in government-run cash assistance programs, and is confident that this can be used to offer immediate support to vulnerable segments of the country’s society.

The governor did, however, highlight that the monetary authorities and regulators would need to build the “requisite skills and technological capacity” to effectively deploy and manage the risks associated with CBDC issuance.

It is still not confirmed if the country will move on to create its own digital currency after this pilot. The central bank governor said in a recent interview that the BSP “has no plans to introduce a CBDC in the near term primarily because the population remains heavily cash reliant given the country’s efficient and effective payment and settlement systems.”

BSP’s announcement follows continued research and development in the CBDC space from other central banks, including the US Federal Reserve. China is also among the countries exploring CBDCs and showcased their digital yuan during the recent Winter Olympics, building on the roll out that took place over the last year and a half.