BSP forum highlights digitalization for rural banks

By Francis Allan L. Angelo

The Bangko Sentral ng Pilipinas (BSP) emphasized the importance of digitalization for rural banks at the Rural Bank Strengthening Program (RBSP) Technology and Innovation Forum, held at the BSP Head Office on May 31, 2024.

In his recorded message, BSP Governor Eli M. Remolona, Jr. stated that the forum aimed “to understand the opportunities and challenges as rural banks embrace technology and innovation.”

He also highlighted the critical role of rural banks in inclusive growth.

“Rural banks can be a linchpin for inclusive growth hence, preserving their role and building up their strengths are crucial for sustainable development.”

Governor Remolona also announced the Monetary Board’s approval of the RBSP Technical Assistance, which includes financial advisory, digitalization, and capacity-building initiatives tailored for rural banks.

“The RBSP commits to assembling a system of support responding to the special circumstances of rural banks,” he added.

Monetary Board Member (MBM) Rosalia V. De Leon reiterated the BSP’s commitment to fostering an enabling environment for banks’ digital transformation.

“The BSP will continue to roll out programs such as the RBSP Technical Assistance and various prudential reliefs and institute key regulatory initiatives geared towards driving digital transformation in the financial industry, all while managing risks attached to these initiatives,” De Leon said.

The forum featured two panel sessions. The first session focused on the potential of satellite technology to enhance rural banks’ operations, particularly in improving internet connectivity, decision-making, risk management, and customer management.

The panel included insights from Philippine Space Agency Deputy Director General Denis F. Villorente, DICT National Broadband Program Project Director Antonio Edward E. Padre, BDO Network Bank, Inc. First Vice President Norman Vic C. Aychocho, and BSP Acting Director Mynard Bryan R. Mojica, moderated by BSP Managing Director Eugene C. Teves.

The second panel session discussed cloud computing and other innovations to spur rural banks’ growth.

Panelists addressed essential factors such as capacity-building, change management, cybersecurity, and the need for senior management support.

DICT Chief of Critical Infostructure Evaluation and Cybersecurity Standards Division George P. Tardio, Rural Bank of San Antonio, Inc. President Ronaldo M. Recto, Asian Development Bank Senior Financial Sector Specialist Kelly Hattel, and BSP Senior Director Melchor T. Plabasan shared their perspectives, with BSP Assistant Governor Lyn I. Javier moderating.

Deputy Governor Chuchi G. Fonacier concluded the forum by emphasizing the BSP’s commitment to integrating the event’s key takeaways into the RBSP Technical Assistance and strengthening collaboration with the rural banking sector.

Launched in June 2022, the RBSP aims to enhance the operations, capacity, and competitiveness of rural banks, acknowledging their vital role in providing financial services in rural and agricultural communities.

The forum attracted rural bankers, technology solutions providers, key government agencies, and financial supervisors.