DeFi Planet

The Bangko Sentral ng Pilipinas (BSP) has completed its pilot program for Project Agila, a wholesale central bank digital currency (CBDC) aimed at improving the efficiency of interbank payments.

The central bank announced this update in a press release on Thursday, December 5.

According to the press release, the initiative enables financial institutions to securely transfer funds beyond regular business hours, including nights, weekends, and holidays, leveraging distributed ledger technology hosted on Oracle Cloud Infrastructure. The BSP stated that the pilot assessed the system’s functionality, performance, security, and programmability.

Unlike retail CBDCs designed for public use, wholesale CBDCs are issued by central banks for commercial banks and financial institutions, facilitating high-value activities like interbank payments, securities settlements, and cross-border transactions. BSP Governor Eli M. Remolona, Jr. emphasized the advantages of wholesale CBDCs, noting their potential to

“enhance liquidity management, reduce settlement risks, and support financial stability.”

While the pilot’s results were not disclosed, Remolona stated that insights from Project Agila would shape the central bank’s future CBDC roadmap, aimed at leveraging digital technologies to bolster the efficiency and resilience of the national payment system.

Launched in March 2022, Project Agila aims to explore how CBDC technology can enhance the efficiency and reliability of the Philippines’ large-value payment system.

This report builds on the recent announcement that BSP is on track to launch its wholesale CBDC by 2029. BSP Deputy Governor Mamerto Tangonan announced that Project Agila, the central bank’s CBDC initiative, is close to completing its proof-of-concept phase. He noted the innovation of the payment instrument and highlighted that the Swiss National Bank is the only one to have launched a wholesale CBDC so far. This update is timely as global competition for digital currencies intensifies. Countries like the U.K. and China are accelerating their CBDC developments, underscoring the importance of BSP’s progress in digital currency.

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