Philippines digital ID project on track for 2021 target as Step 1 registration tops 37M
Authorities in the Philippines are optimistic the target set this year for registration for the national digital ID card (PhilID) through the Philippine Identification System (PhilSys) will be met, given that millions of people are completing various stages of the process.
A report by The Manila Times quoted the National Economic and Development Authority (NEDA) as saying that the Philippine Statistics Authority (PSA) is sure to register 50 to 70 million people for the national digital ID by the end of the year as projected.
NEDA noted that as of July 2, a total of 37.2 million persons had gone through the Step 1, which involves the collection of demographic information, while 16.2 million others had completed Step 2, which involves the capture of biometrics at designated registration centers, The Manila Times states.
Speaking on the progress being made by the digital ID project, Socioeconomic Planning Secretary at NEDA Karl Kendrick Chua said: “The COVID-19 crisis underscores the need to provide unhampered access to banking and social services for all Filipinos, especially the poor. This is why the President gave the directive to accelerate the implementation of the Philippine Identification System or PhilSys to provide all Filipinos a unique and digitalized ID.”
NEDA also hailed the deal between PhilSys and the LandBank of the Philippines which has made it possible for millions of unbanked Filipinos to have access to bank accounts, saying as of July 2, some 4.4 million persons had applied for bank accounts. As of May, a total of 3.79 million had actually become part of the formal banking system of the country, NEDA said, quoting LandBank CEO Cecilia Borromeo.
The CEO also says the delivery of government aid programs will henceforth be effective and smoother thanks to the facilitation of bank account opening for PhilID registrants.
Rolando Bautista, Secretary of the Philippines Department of Social Welfare and Development, also opined recently that the PhilID national digital ID will enable authorities to easily identify potential beneficiaries of government charity schemes.
Over 1K Filipino physical bank branches to shut as digital surges
The shift to digital banking is becoming more palpable as about 11,000 physical bank branches are set to close up in four Asian economies including Indonesia, Thailand, Philippines and Malaysia by 2030, with Philippines to account for 1,500 of that number, The Manila Times reports.
Citing an industry report from financial consulting firm Roland Berger, the outlet notes that this trend is thanks to many factors including digital identity and the development of artificial intelligence which is helping many banks to digitize their operations.
Aradhna Sharma, Southeast Asia Digital and Data Solutions Director at Advance.AI, told The Times in an interview that not only has the growth in smartphone use and internet connectivity driven this trend, circumstances such as the COVID pandemic have also played a great role, as many people now prefer to carry out banking transactions without much physical contact.
In the question-and-answer exchange with The Manila Times, Sharma also shared his thoughts on the prospects for digital banking growth in the Philippines, saying the government must put in place the right framework and regulations for such innovation. He also talked about investing and harnessing talents in tech, and encouraging investments in the sector by weeding out inertia and other administrative and procedural bottlenecks. He suggested that banks transforming into digital mode must be innovative enough and ready to offer the best services in order to attract keep the clientele given that 71 per cent of Filipinos are unbanked, according to statics from the BSP.
On the role that biometric technology can play in pushing ahead the digital banking agenda, Sharma said: “For example, facial recognition technology could verify a customers’ identity based on selfies or a short video of themselves during a video call with a customer service agent, which could be done remotely without having to go to a bank branch. Optical character recognition software could authenticate customer identities based on photos of their national identity documents.”