Bank of Papua New Guinea: Press Release
This Statement of Intent outlines the current views and approach of the Bank of Papua New Guinea (BPNG) with respect to electronic and mobile payments services, and sets out the stance and measures which BPNG intends to adopt in the future.
Electronic and mobile payments instructions and alternative methods of payment services have been introduced in recent times in the country. These payment innovations were made possible with increased competition and penetration of mobile phones and improvement in telecommunication infrastructure. Mobile banking, where the mobile phone is used as the device to initiate informational inquiries or payment instructions is fast becoming common in many developing countries. The penetration of mobile phones in PNG has increased rapidly in the past three years, and close to 80% of the population is within wireless coverage areas. This development enables the user of the mobile phone as a new financial tool.
As per section 7(c) of the Central Banking Act 2000, BPNG welcomes the introduction of electronic and mobile payment services, which can assist in reducing transaction costs and contribute to the expansion of financial services within the rural population. Whilst it seeks to balance openness to innovation and competition in the PNG financial system it is important to ensure these services are operated at the highest standard of safety, security and cost-effectiveness with adequate levels of protection for the consumer’s interests. Electronic and mobile payments are an important element of the PNG National Payments System Development and its general policy for a sound efficient low costs payment system, which was launched on 30 November 2009 (as notified in the Media Release dated 15 January 2010).
The BPNG intends to monitor new electronic and mobile payment services and systems entering the market and commits itself to working with the service providers and other stakeholders to develop the necessary legal and regulatory regime that will enable new, innovative and interoperable electronic payments systems to be introduced to the market. It intends to undertake this process using the experience gained from these new systems and consistent with international best practises. To this end, the BPNG encourages any potential providers of electronic and mobile payments systems, by authorised institutions or others, to meet with BPNG and outline their plans. These discussions will enable the BPNG to understand the implications of such products on the retail payments system in the country.
Authorised by: Loi M Bakani