List of electronic banking services expand

it matters
Friday-Saturday, December 30-31, 2005 MANILA, PHILIPPINES

List of electronic banking services expand

The internet remains the most popular way of providing electronic banking service to clients, but banks have introduced new offerings with the potential of boosting efficiency and reducing costs.

Data obtained from the Bangko Sentral ng Pilipinas showed that cash cards were the latest addition to banks’ e-banking systems -- which cover the internet; proprietary applications; mobile phones; fixed phone lines; and the switches of ATM networks Bancnet and Megalink.

Electronic banking enables clients to avail of diverse banking products and services through the internet by way of a personal computer, and through telephones.

Banks that ventured into e-banking recognize its potential to fuel revenue growth, greater efficiency and at the same time reduce information and transaction costs.

This year, the central bank’s list included cash cards, or bank-issued cards that are good as cash.

Four banks ‹ Banco de Oro Universal Bank, Security Bank Corp., Union Bank of the Philippines, and Citibank NA ‹ were given permit to offer cash cards.

Based on the central bank’s last tally, of the country’s 44 commercials banks, 34 offer more than one e-banking mode. Only Security Bank offers the six types of e-banking services. United Coconut Planters Bank and Standard Chartered Bank offer five but not cash cards. Nine banks offer at most four.

In the first semester, 44 banks were granted e-banking permits, up from 42 in the same period last year.

Cash cards, currently the e-banking product offered by the least number of banks, trailed behind proprietary applications ‹ or exclusive transactions usually between a foreign bank and their privileged clients.

Next to the internet, the second most popular mode of providing e-banking is thru mobile phones, the internet, or through the ATM systems of Bancnet and Megalink.

The government is pushing for the promotion of e-banking to reduce information and transaction costs and enable clients to get wired into the sources of funds.

"As the volume of e-money transactions increases, the identification, assessment, management, and control of the attendant risks will be properly evaluated," the National Economic and Development Authority had said.

The Monetary Board, in its Resolution No. 2130 dated December 8, 2000, approved guidelines concerning electronic banking activities.

Under the resolution, banks wishing to provide and/or enhance existing electronic banking services should have the following minimum pre-conditions:

• An adequate risk management process is in place to assess, control, monitor and respond to potential risks arising from the proposed electronic banking activities;
• A manual on corporate security policy and procedures exists that shall address all security issues affecting its electronic banking system like authentication, integrity and confidentiality;
• The system had been tested prior to its implementation and that the test results are satisfactory.
• A business continuity planning process and manual has been adopted which should include a section on electronic banking channels and systems.

-- Paolo Joseph L. Lising