The Monetary Board of the Bangko Sentral ng Pilipinas (BSP) has approved amendments to customer due diligence regulations which include guidelines on electronic know-your-customer using digital identity system.
The new rules set out the requirement for the use of digital identification and verification as part of the customer onboarding process of BSP-supervised financial institutions (BSFIs).
The guidelines recognize the use of e-KYC through the digital ID system and provide the minimum requirements for BSFIs in the conduct of e-KYC. In particular, the latter should be anchored on robust information and communication technology architecture and tiered or risk-based e-KYC policies and procedures with commensurate onboarding requirements and authentication assurance levels.
The enhanced rules emphasize that the Philippine Identification System (PhilSys)-enabled e-KYC to be launched by the Philippine Statistics Authority (PSA) is an acceptable system for e-KYC under Republic Act No. 11055 or the PhilSys Act and its revised implementing rules and regulations. PhilSys-enabled e-KYC shall be allowed subject to PSA’s applicable guidelines and full implementation of the authentication procedures/methods and other related systems under the PhilSys.
Bangko Sentral Governor Felipe M. Medalla emphasized that “The policy enhancements promote seamless remote identity verification by leveraging on the use of technology and existing e-KYC systems. E-KYC is one of the key enablers to promote innovation and digital transformation aimed at advancing our financial inclusion agenda.”
BSFIs with existing e-KYC systems are given one (1) year to comply with the prescribed e-KYC requirements. Meanwhile, BSFIs that intend to shift to an e-KYC system are expected to comply with the provisions of the new circular before the implementation of the system.