##cb. to fully reap the rewards of financial innovation, we need to strike a balance between optimizing the benefits of digitalization against the overall safety and soundness of the financial system. digital transformation in correspondent banking is not a future event. it is a present reality. recognizing this, we need not be apprehensive. instead, we must start working together, always keeping a positive mind - set. in closing, i emphasize the importance of sustained collaboration among stakeholders. this is needed to create a safe, efficient and reliable digital environment. as new technologies like mobile banking, social networking, big data, and cloud computing advance, so must banks need deeper and wider understanding of trends. stakeholders would do best to identify growth opportunities and establish synergies with new players and industries and with each other to remain competitive and relevant. i look forward to joining this afternoon ’ s panel discussion. thank you very much and good morning. 5 / 5 bis central bankers'speeches

fintech developments and emergence of technology - related risks while remaining supportive of financial innovation. some of these regulations have significant impact on correspondent banking. staying competitive in the midst of digital revolution the rapid evolution of digital technology, particularly the widespread use of smart phones at the turn of the new millennium, revolutionized financial product and banking service delivery. customers now have unprecedented access to a wide array of electronic platforms. included in these are virtual financial services platforms, which allow customers to perform banking transactions and make payments anytime, anywhere, and at their own convenience. recognizing that electronic banking expands client reach and improves financial access, as early as 2000, we allowed banks to engage in electronic banking. in parallel, we have implemented a cash agent model. this provides an innovative service delivery channel through combining e - banking self - service online and real - time transactions, with cash - in, cash - out ( cico ) provided by third - party cash agents. emerging digital solutions, products and services, push banks to keep pace with increasing competition posed by even non - bank players. non - bank players offer financial products and services with thoughtfully designed user interfaces. one recent development with significant impact to correspondent banking is the rise of blockchain or distributed ledger technology ( dlt ). 2 / 5 bis central bankers'speeches hence, correspondent banks must embrace this wave of innovation and rethink strategies. to grow markets in the midst of competition, new customer solutions through efficient operations should be delivered. technology - based solution providers suggest that blockchain or dlt could be harnessed to alleviate some correspondent banking issues. this can be achieved by enabling better risk management, reducing costs, and providing an alternative payment platform, especially in terms of transferring small - value payments. in this connection, the bsp is working closely with market innovators and industry players to explore tie - ups of correspondent banks with dlt providers. we believe that collaboration and strengthening partnerships with other fintech players is a way to boost digital capabilities of correspondent banks. we recently approved a project under the test - and - learn approach. the project will facilitate creation of a real - time domestic and overseas remittance corridor without the need to establish a central operator. this will prove beneficial to our remittance sector which relies heavily on correspondent banking for the safe and efficient settlement of transactions. the bankers association of the philippines ( bap ) is also spearheading a project to develop digital ids powered by blockchain technology. establishing a safe