Finance Secretary Benjamin E. Diokno and Ambassador of India to the Philippines Shambhu Santha Kumaran signed a memorandum of understanding (MOU) on June 19, 2023 at the Department of Finance (DOF) office in Manila to enhance cooperation between the Philippines and India in the field of Financial Technology (FinTech).
“Today’s event marks an important milestone in the bilateral relations of India and the Philippines—just in time for the upcoming 5th Philippines-India Joint Commission on Bilateral Cooperation set to take place in New Delhi, India a few days from now,” Secretary Diokno said.
The MOU directs the constitution of a Joint Working Group (JWG) on FinTech with the Government of the Republic of India (GOI)’s Department of Economic Affairs (DEA), Ministry of Finance.
The creation of a JWG is expected to facilitate inter-governmental discussions on 1) the exchange of best practices to improve policies and regulatory connection, 2) promote cooperation in the development of FinTech solutions for business or financial sectors, and 3) develop international standards by encouraging the creation of an international version of Application Programming Interfaces (API).
“On the one hand, India is a rising economic powerhouse, with a forte in digital technology. On the other, the Philippines hosts a young and tech-savvy talent pool that can provide the intellectual capital needed to succeed in the digital economy. Clearly, the possibilities between our two economies are boundless,” Secretary Diokno said.
“In India, for the past seven years, we have seen an exponential growth in digital payments. Currently we are at the level of a hundred billion digital payments a year, with the flagship UPI itself – unified payments interface – itself becoming one of the primary drivers of a cashless, digitalized economy,” Ambassador Kumaran said in his remarks.
The JWG will be co-chaired by the DOF and the DEA. Members from the Philippine government include the Department of Foreign Affairs (DFA), National Economic and Development Authority (NEDA), Bangko Sentral ng Pilipinas (BSP), Department of Information and Communication Technology (DICT), Securities and Exchange Commission (SEC), Insurance Commission (IC), and Philippine Statistics Authority (PSA).
On the other hand, members from the GOI include the DEA, Ministry of Electronics and Information Technology (MeiTy), Union Identification Authority of India (UIDAI), Reserve Bank of India (RBI), Securities and Exchange Board of India (SEBI), Insurance Regulatory Development Authority of India (IRDAI), Pension Fund Regulatory and Development Authority (PFRDA), Ministry of External Affairs, International Financial Services Centres Authority (IFSCA), and Indian Computer Emergency Response Team (CERT-In).
In addition, the Ambassador of the Philippines to India and the Ambassador of India to the Philippines will serve as points of contact and participate in JWG meetings.
“Recognizing this immense and far-reaching economic potential, the administration of President Ferdinand Marcos, Jr. has placed a high premium on digital transformation,” Secretary Diokno said.
Just last March 6, 2023, the House of Representatives approved House Bill (HB) No. 7327 or the E-Governance bill, which is a priority measure of the PBBM administration.
The E-Governance bill promotes the use of information and communications technologies (ICT)s within and across government agencies to provide faster and improved delivery of services to the public. This will also promote greater financial inclusion across the country.
Furthermore, the Philippines has put in place enhanced economic liberalization bills such as the Public Service Act (PSA), Foreign Investments Act (FIA), and Retail Trade Liberalization Act (RTLA) to open up the country to investments in advanced technology.
By offering competitive fiscal incentives to technological companies, the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act helps foster a vibrant culture of research and innovation that promotes knowledge transfer and creation.