Bangko Sentral ng Pilipinas (BSP) National Retail Payment System (NRPS) Framework: The Rising Imperative of Implementing E-Wallet Technology

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4 min readJul 2, 2019

Based on the study conducted by Better Than Cash Alliance (BTCA), The Philippines has an estimated 2.5 billions of payments per month amounting to $74 billion (Php 3.76 trillion). But only 1% are transacted electronically; 99% of the transactions are paid either in cash or checks.

BSP wants to increase the electronic payment to 20% by the year 2020. In its bid to shift from a cash-heavy to cash-lite economy, BSP launched the National Retail Payment System (NRPS) Framework last December 9, 2015. The vision of the NRPS is to create a safe, efficient and reliable electronic retail payment system that is interconnected and interoperable.

Almost two (2) years after the initial launch of the NRPS Framework, BSP issued Circular №980 or the Adoption of National Retail Payment System (NRPS) Framework. Followed by Memorandum No. M-2018–012 — Guidelines on the National Retail Payment System (NRPS) Key Principles and Specific Rules Applicable, and Memorandum No. M-2018–026 — Availability of InstaPay and PESONet in all existing electronic delivery channels, issued last March 23, 2018 and September 4, 2018 respectively.

Figure 1 — NRPS Framework

In a nutshell, the above mentioned circular and memorandum mandates all BSFIs (BSP Supervised Financial Institutions) with authority to offer EFPS (Electronic Financial Payment Services), such as electronic banking, shall make fund transfer via InstaPay and or PESONet available through its e-channels such as internet and mobile by November 30, 2018. The operative word is with, which means the scope is limited only to the BSFIs with authority to offer EFPS.

Figure 2 — Banks in the Philippines

As shown in Figure 2, there are 454 rural banks in the Philippines, but only a handful are EMIs (Electronic Money Issuers), participants of InstaPay, Bancnet and none in PESONet yet.

Figure 3 — The Problem

Depends on the design and volume of the chip card, the cost of a chip card is between USD 2.00 to USD 4.00 excluding card personalization and logistics costs. Foreign payment network license fees for issuing/acquiring bank(s) is between USD 500k to USD 1 million. ATM (Automated Teller Machine) cost is between USD 3k to USD 4k, POS (Point-of-Sale) terminal depends on the brand and volume is between USD 400 to USD 800, a set of HSM (Hardware Security Module) is around USD 400k. Card Management System can cost up to USD 2 million, even more.

The high cost of E-Money technology is what stopping the vast number of rural banks to offer EFPS. Enabling these rural banks with E-Money technology is the first step for them to adopt the NRPS Framework, such as becoming a participant of InstaPay or PESONet.

Figure 4 — The Solution

Pearl Pay’s vision is to empower and unify these hundreds of rural banks by providing a world-class yet affordable E-Wallet white-label solution. Pearl Pay aims to bring mainstream and innovative banking services to the rural areas by tapping the existing rural banks’ network and physical branch infrastructure. Pearl Pay Founders are composed of purpose-driven, highly-skilled business technologists, electronic payment technology experts, and blockchain engineers who passionately want to improve people’s lives. Our commitment to providing E-Wallet technology into the hands of all the rural bankers led us to design and innovate a system that generates synergies and economies of scale through a common infrastructure to allow us to offer it for affordable pricing (i.e., starts at US$99 / month). No software license fee, and no setup fee, this proves our devotion to our mission that no rural banks will be left behind.

Figure 5 — The Role of PearlPay in the NRPS Framework

Pearl Pay was established to strengthen the rural banking industry. It aims to bring about more resilient rural banks and a less fragmented banking system by enabling them with a world-class E-Wallet technology and help them adopt and participate in the NRPS ecosystem.

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Cited Sources

Bangko Sentral ng Pilipinas (BSP) National Retail Payment System (NRPS) Framework: The Rising Imperative of Implementing E-Wallet Technology

Written by Spark Perreras