Boosting Consumer Protection Amid Rising Digital Transactions: A Look at Key Milestones in 2023
In 2023, consumer protection in the realm of digital transactions reached significant milestones as both the public and private sectors prioritized the safety of consumers. However, the ever-evolving tactics of scammers necessitate further efforts to strengthen consumer defenses.
The increasing reliance on digital platforms has become an integral part of our lives. Whether it’s work, studying, shopping, or banking, we now have the convenience of doing it all through our computers and mobile phones. The COVID-19 pandemic has surely accelerated this shift, but even as in-person activities resume, the boom in digital consumerism continues.
Banks and financial institutions have also embraced this digital transformation by developing online banking solutions, creating mobile banking apps, utilizing artificial intelligence (AI) for personal finance management, and introducing other innovative technologies. These advancements aim to make banking easier, more efficient, and more inclusive.
With the rise in digital payment systems, banks and financial institutions have been working diligently to protect their customers from fraud and cybercrime while reinforcing confidence in these payment platforms.
The numbers speak for themselves when it comes to the importance of digital payments for Filipinos. According to the 2022 Status of Digital Payments study conducted by the Bangko Sentral ng Pilipinas (BSP), digital payments accounted for 42.1 percent of total retail payments in 2022. This is a significant increase compared to previous years, with percentages of 30.3 in 2021, 20.1 in 2020, 14 in 2019, and 10 in 2018. The main drivers behind this surge in digital payments were merchant payments and person-to-person fund transfers, reflecting the growing confidence among Filipinos in utilizing these platforms. Therefore, it is of utmost importance for banks and financial institutions to reinforce this confidence and ensure that consumers can maximize the benefits of digital payments without worrying about cyber threats.
In terms of consumer protection in 2023, the year began with the approval of the Philippine Development Plan (PDP) 2023-2028. The plan encompasses strategies to promote an inclusive, innovative, and healthy financial sector. One of the key aspects of this plan is the intensification of consumer protection through the implementation of the Financial Products and Services Consumer Protection Act. Additionally, the regulatory environment will be enhanced, stronger cybersecurity measures will be enforced, and cybersecurity awareness campaigns targeting financial scams will be conducted among private financial institutions.
Another significant development was the government’s support for the Anti-Financial Account Scamming Act (Afasa). This proposed law aims to impose penalties on money mules, social engineering schemes (such as phishing and vishing), and economic sabotage. The Bankers Association of the Philippines strongly advocates for the approval of Afasa because they are well aware of the challenges posed by cybercriminals and the need for robust consumer protection mechanisms.
To complement these policies, the TrustTech movement was launched in July 2023. This initiative brought together key players from the national government, private sector, civil society, and country partners to discuss the challenges and opportunities in combating financial cybercrimes and strengthening trust in the digital landscape. The TrustTech movement aims to foster cooperation among stakeholders, implement stronger measures against cybercrime, promote best practices in consumer protection, and raise awareness about cyber threats, empowering the public with the necessary information to combat scams and other forms of fraud.
While there have been significant achievements in 2023, there is still more work to be done. The signing of Afasa into law is eagerly anticipated, and further activities are planned for the TrustTech movement. Moreover, staying ahead of the constantly evolving tactics of cybercriminals requires a continuous focus on cybersecurity trends and fostering collaboration among relevant stakeholders to share knowledge and learn from one another.
As the new year unfolds, it is crucial to maintain the momentum and prioritize consumer protection to ensure the safety and confidence of banking customers. By leveraging ongoing efforts, implementing new regulations, and fostering cooperation, the Philippines can continue to enhance consumer protection in the digital realm and mitigate the risks posed by cyber threats.
