CoDi is an operational reality; the challenge is to make it for everyone, says the Bank of Mexico
"The challenge is to turn CoDi into a reality of widely used payments accessible to all Mexicans and a technological platform that promotes greater financial inclusion and development opportunities for the population," he said.
He added that different financial institutions are testing CoDi with accounts and real money in order to adjust the final details of the project through pilot tests along with a communication campaign prior to its launch on September 30.
"CoDi has several key benefits that allow transactions to be quick and with the highest security standards and guarantee the security of financial resources at all times, avoiding waiting times to receive money and promoting financial inclusion," he explained.
In the framework of the 25th anniversary of the Bank of Mexico's autonomy, he mentioned that the system that takes advantage of the high and low value payment infrastructure by the Interbank Electronic Payments System (SPEI), which allows to liquidate the operation in real-time and in conjunction with the financial participants including the use of QR and NFC technologies.
"In this way, the possibility is extended that it can be used by all the public who have a smartphone for which it only requires to have or open a bank account," he said.
He added that electronic payments through QR and NFC codes, "which are at the frontier of payment systems," are two alternatives worldwide, which unlike CoDi, have multiple private networks and different protocols, which force users to need multiple platforms to make payments.
"It is the provision of a single and homogeneous basic infrastructure where all users transit on the same network that is provided in an open and neutral way for all participants and on which they can add or innovate different financial products of high added value for the benefit of end-users," said Diaz de Leon.
He pointed out that in this sense, work must be done to generate the interoperability of services, the reduction of costs, the immediacy of transactions with high-security standards and to consider mechanisms and contingency plans that ensure operational continuity all the time.
"In a world where new developments come from a large number of providers, with different objectives and technologies, central banks should promote payment systems that serve as a space for the interaction of different participants and enable the attraction of more participants.
In line with international trends, central banks should encourage the positive externalities associated with payment systems, reduce information asymmetry and increase network effects by allowing, with clear rules, a wide variety of participants, said the central bank governor.
MICRO-PILOTS TO OPERATE CODI
There are six financial institutions that have started the processes to use the Cobro Digital System (CoDi) of the Bank of Mexico (Banxico), of which only two are already in the process of making movements in real-time.
There are four banks (Banamex, Bancomer, Banorte, and Santander) and two others are regulated financial institutions. Of these, two operate the micro-pilots, because the operations are only being carried out among their employees.
The project is proceeding according to schedule, so that on the last day of September, the operation of CoDi, is mandatory for all banks; through more than three thousand accounts that would operate at the beginning of this platform.
"To be able to operate from the perspective of final clients, a few months must still pass in which the elements are adjusted and it is determined if there are areas of opportunity within the operation of the system." (director Miguel Diaz)
BENEFITS OF THE CODI
With the CoDi payment system, Banxico aims to reach people who do not have a bank account, but a mobile phone with which they can scan a QR code and process payments through the different commercial banks and financial entities.
At least 30 million Mexicans will be able to access products with higher added value such as loans, insurance or investments. After performing the first trial period, the second, which is larger, will begin in the next two or three months.
The messages to request or receive payment are small, so the use of mobile data is very similar to a normal messaging scheme. The preliminary scheme of CoDi is planned from April to September.
The new platform will limit illicit activities such as money laundering, tax evasion and acts of corruption, through the reduction of the use of cash.
In addition to facilitating the dispersion or delivery of social and economic support instrumented by the government; such as scholarships for young people or pensions for the elderly.
"If we consider that the number of people with smartphones, which is twice the number of people who have a bank account, it is very clear that CoDi can have a great impact and incorporate a universe of potential customers into the financial sector". - The governor of the Bank of Mexico (Banxico), Alejandro Díaz de León
The system will have a positive effect for banks: it will streamline payments, reduce costs and maximize the security of its operations; while the user will be able to familiarize himself/herself with the financial system.
HOW CODI WORKS
Use QR codes to make electronic transfers through smartphones every day of the year and at any time, from a bank account.
QR codes will be linked to the user's bank account; will be generated through the mobile application (app) of each bank; they will be authenticated by the Bank of Mexico and will allow the transfer of money without the need for users to have access to codes or account numbers.
It constitutes a platform that functions as an extension of the Interbank Electronic Payment System (SPEI), which is the most important transaction mechanism in the country.
Allows direct transactions from phone to phone; without having to go through any intermediary; with the only condition of having a bank account and being a user of mobile banking.
The system will work through any bank account, regardless of the bank; through a standard platform that will be available to merchants, small shops, service providers and people in general.