InstaPay transactions surge sevenfold

October 26, 2018

USAGE OF THE central bank’s InstaPay platform has surged sevenfold as of September from the initial volumes when the platform for real-time interbank transfers was launched earlier this year.

Latest available data from the Bangko Sentral ng Pilipinas (BSP) showed total InstaPay transactions at P2.606 billion in September, more than seven times the P19.119 million traded back in April when the electronic facility went live.

InstaPay is an automated clearing house which processes real-time transfers worth P50,000 or lower across accounts or e-wallets from different banks or service providers. Money is sent and credited to a destination account in a matter of seconds or minutes.

The tally showed a sustained uptrend in total monthly transactions processed under InstaPay in terms of both volume and value. In fact, interbank transfers surged tenfold within the first month when the platform was made available to online banking users, with transactions rising to P190.91 million in May.

By volume, 1,740 fund transfer commands in April leaped to 12,548 a month later, and eventually to 225,519 in September.

There are 18 banks and electronic money issuers which allow clients to send and receive money via InstaPay as of early October, while 33 financial firms can receive funds through the interbank service.

Transaction fees vary across service providers, with some charging P10 for every InstaPay transaction, while the steepest is set at P100, according to a list published on the BSP website as of May.

Vicente T. de Villa III, officer-in-charge of the BSP’s Financial Technology Sub-Sector, has said they have seen “catapulting increase” in InstaPay usage, versus modest but stable activity in another clearing house which went live in November last year.

The Philippine Electronic Fund Transfer System and Operations Network (PESONet) — which compiles all interbank fund transfer instructions, runs a batch process, and credits the amount to the receiver by the end of the banking day — saw transfers grow relatively steady since its launch.

PESONet transfers started at P52.764 billion and even dipped to P52.595 billion in December, data showed. Transaction value has since grown to P63.597 billion as of September, with a peak of P74.45 billion tallied the previous month.

By volume, September saw 555,972 fund transfers fulfilled, higher than the 329,906 tallied when the PESONet started.

The central bank has required all banks and other financial firms to offer electronic banking portals and interbank transfer schemes in place by Nov. 30, in line with the regulator’s goal of prodding increased use of digital.

The BSP is eyeing to raise the share of e-payments to 20% of all transactions in the Philippines by 2020, coming from a measly 1% share back in 2013.

Central bank officials have also said that they are eyeing to set a national standard on quick response (QR) codes, which is expected to promote wider use of digital retail payments and away from cash. QR images can be scanned using a smartphone camera, which will then allow a customer to pay their bills fully online.