While access and security concerns continue to prevent electronic banking from fully taking off in the Philippines, a top executive of the United Coconut Planters Bank (UCPB) noted that the value and volume of e-banking transactions have grown steadily over the past three years.
E-banking is defined by the Bangko Sentral ng Pilipinas (BSP) — the country’s central bank — as a system that enables bank clients to avail themselves of the bank’s products and services through the use of the Internet or a telephone.
Through e-banking, carriers are able to provide clients with more extensive access to diverse financial products, services and offerings. For the banks, the benefits include greater service efficiency and growth while cutting down information and transaction costs.
UCPB vice president Margarita Lopez told Computerworld Philippines that the stable increase in transactions reflect the growing acceptance of e-banking among bank customers as a secure, reliable and convenient delivery channel for accessing bank services.
For the first nine months of 2004, the total value of customer transactions through e-banking facilities has already reached 5.32 billion pesos (US$95 million), a 66 per cent increase from last year’s 3.19 billion pesos.
“This is a significant and exciting development because it indicates that bank clients have already reached a higher degree of sophistication and are ready for more e-banking offerings,” said Lopez.
Recent studies from research firm ACNielsen also showed that of the one million regular Internet users in the country today, 23 per cent are now performing e-banking transactions.
Data obtained from the BSP showed that the number of banks with e-banking permits grew to 42 during the first semester of the year from only 30 last year.
Of these 42 banks, 27 provide Internet banking services. Twenty-four of these are universal and commercial banks, while three are thrift banks.
The Bank of the Philippine Islands, Union Bank of the Philippines, Metropolitan Bank and Trust Co., Equitable-PCI Bank, and Citibank NA are just some of the banks that offer electronic banking. Preferred Channel
Although the bulk of UCPB’s e-banking transactions is still done over the telephone, Lopez noted that in a few years time, marked changes may emerge in the way banks provide financial services as well as the way clients conduct their businesses. “The Internet is quickly catching up as the preferred e-banking channel,” claimed Lopez.
UCPB Telebanking, the bank’s telephone banking service, posted its highest usage record so far during the first nine months of the year with 1.1 million transactions valued at 4.1 billion pesos.
Similarly, the use of Short Messaging System (SMS), better known as texting, through mobile phones is also growing in popularity among bank clients. Mobile phones have become a major payment instrument that now rivals the more established credit and debit cards.
Likewise, the government has also started to recognize the value of e-banking for improving the efficiency of its financial transactions with the public as more and more agencies start to automate their payment systems with the use of various e-banking models. Government agencies that have already taken the e-banking route include the Bureau of Internal Revenue, Bureau of Customs and the Security and Exchange Commission.
ACNielsen also pointed out that the increase in e-banking transactions can also help develop other Internet activities such as online shopping.
“Once people become comfortable doing their banking online, it becomes a small step to try out other Internet activities like online shopping,” said ACNielsen Philippines’ information chief Elena “Bing” Van Tooren.