India and Philippines sign MOU on fintech cooperation on 19 June 2023Posted on: June 20, 2023 | | Back | Print
Embassy of India
A Memorandum of Understanding (MOU) between the Department of Economic Affairs, Ministry of Finance, Government of India and the Department of Finance, Government of Philippines on Financial Technology (fintech) cooperation was signed in Manila today. The MOU was signed by H.E. Shambhu S. Kumaran, Ambassador of India to the Philippines and Hon. Benjamin E Diokno, Secretary, Department of Finance (DOF).
The MOU envisages the constitution of a Joint Working Group (JWG) co-chaired at the Undersecretary level from the Ministries of Finance, and comprising senior representatives from Foreign and IT Ministries, Central Banks, financial sector regulatory institutions and other related agencies as members. The JWG would identify concrete measures for partnership in innovative technologies; fintech industry, digital governance; payment linkages; creation of interoperable APIs; financial inclusion and other related areas.
Speaking on the occasion, Ambassador Kumaran noted that during their telephonic conversation last year, Prime Minister Narendra Modi of India and President Ferdinand R. Marcos Jr had identified partnership in digital economy, in particularly the financial sector, as one of the priority areas for bilateral engagement. He said this MoU would serve as an enabler in building such a partnership by providing an institutional framework for cooperation on three key areas: digitalization of payments; direct benefit transfer using national ID and financial inclusion. Ambassador Kumaran hoped the MOU will connect India’s thriving financial sector ecosystem, which has made impressive strides in the recent past, with that in the Philippines, where the sector is growing rapidly. He pointed out that in India digital payments have witnessed exponential growth, reaching nearly 100 billion per year, with the flagship Unified Payment Interface (UPI) emerging as the primary driver towards a cashless economy. The MOU would enable the Philippines to adopt the best practices from India in this regard.
Finance Secretary Benjamin E. Diokno noted that Administration of President Marcos Jr. has placed a high premium on digital transformation. He stated that the MOU is a milestone that opens boundless opportunities for cooperation, as India is a rising economic powerhouse with forte in digital technologies, while the Philippines hosts a young and tech savvy talent pools that can provide intellectual capital to succeed in the digital economy. Secretary added that intergovernmental engagement under the MOU will promote cooperation between fintech industry in India and Philippines, including development of fintech solutions across business and financial sectors; creation of inter-operable standards for Application Programming Interface (API) thereby strengthening digital governance; promoting use of digital signatures across borders and mainstreaming digital fund transfer platforms, among others.
Both Ambassador Kumaran and Secretary Diokno noted that one of the focus areas under the MOU is promoting financial inclusion to address the digital divide. Ambassador Kumaran pointed in this context to the significant progress in India in terms of the ‘India Stack’ Digital Public Infrastructure (DPI) based on the foundational Aadhar ID system, adding that as the Philippines had based its own ID on the Indian modular open-source (MOSIP) platform, this would enable similar initiatives to be successfully implemented by the Philippines.
India has signed similar MOUs with the Singapore and UK on fintech cooperation. The signing of the MOU, following on the agreement in February 2023 on Indian Quick Impact Projects, underlines the rapid scaling up of India-Philippines economic engagement focused on initiatives to enhance the developmental partnership between our two vibrant democracies in the Indo-Pacific region.