An official from the Bangko Sentral ng Pilipinas (BSP) has disclosed further details regarding the central bank’s exploration of wholesale central bank digital currency (wCBDC), as reported by a local press outlet.
During a press conference on March 6, BSP’s Deputy Governor for Payments and Currency Management Sector, Mamerto Tangonan, shared insights into the wCBDC pilot project, named Project Agila, slated for completion by the year’s end. Tangonan characterised the pilot initiative as a “learning exercise,” highlighting its potential to democratise access to securities and investment instruments:
“We envision a Philippines where access to securities and similar investment instruments can be democratised, meaning they could be purchased for smaller issue sizes and much much lower fees so that any Juan or Maria cannot only dream but actually own securities.”
Participating in the pilot alongside BSP are six domestic banks: BDO Unibank, China Banking Corp., Land Bank of the Philippines, Rizal Commercial Banking Corporation, Union Bank of the Philippines, and Maya Philippines. The project employs wCBDC for interbank fund transfers, with Tangonan expressing interest in exploring its application for higher-value services like securities settlement.
BSP Governor Eli Remolona, in remarks made in February, underscored the central bank’s focus solely on wCBDC, citing concerns surrounding bank disintermediation and related issues that might arise from a retail CBDC issuance. Remolona clarified that the wCBDC would not operate on a blockchain.
The Philippines initially expressed interest in issuing a CBDC in 2020, with BSP’s Monetary Board acknowledging positive assessments of wCBDC and outlining plans for pilot tests commencing in 2022 under the banner of Project CBDCPh, later renamed Project Agila. The pilot project’s launch was formally announced in April 2022.
In 2023, the Philippines participated in a pilot study involving the Digital Dollar Project, Western Union, and BDO Unibank, examining the potential of a retail CBDC for remittance purposes. The study indicated cost reduction and increased transparency and competition but highlighted challenges in transaction speed due to most remittances arriving after working hours.
