Bangko Sentral NG Pilipina’s (BSP), the Philippine Central Bank, urges financial institutions to adopt a “market-based” and “fair” pricing mechanism for digital transaction fees, in a feature aimed at reducing if not removing consumers for consumers Transfer money electronically.
BSP is currently seeking comments from stakeholders on a draft circular that would guide banks and non-bank financial institutions to set their fees for Electronic Fund Transfers such as Instapay and Pesonet.
“The pricing mechanism must be sufficiently supported by an analysis of costs incurred by BSFI (BSP-Supervised Financial Institutions) to deliver electronic payment products and services, which may be subject to validation of BSP,” stated in the proposal. BSP emphasized that these pricing models must not create an imbalance between different users. “The pricing mechanism should not unnecessarily favor an end user in relation to others,” the draft noted.
The proposed guidance marks a transition from the Central Bank’s previous approach and explicitly proposes elimination of fees for personal fund transfers. This provision is no longer part of the current draft.
Although the banks’ response to the previous proposal remains unclear, all efforts to get down Digital transaction Costs are consistent with BSP’s broader agenda to increase digital adoption and improve financial access to the Philippine population.
According to BSP data, current Instapay fees vary from PHP8 to PHP75 ($ 0.14 to $ 1.35) per transaction, while the Pesonet fees can go as high as the PHP600 ($ 11). Furthermore, the draft Circular introduces an extra layer of monitoring, which requires BSP approval for any increases in existing fees or the introduction of new fees on digital payment services.
Digital Payment Use Increases as BSP -Eyes More Inclusive Systems
BSP’s driving force for fairer transaction fees comes on the back of Rising digital payments across the country. According to the latest central bank’s data, the proportion of digital payments in total retail transactions increased to 52.8% in 2023, up from 42.1% in 2022. This means that of the estimated five billion monthly payment transactions in the country last year, over SEK 2.6 billion was carried out through digital channels.
The central bank sees this growth as both an opportunity and a responsibility. By ensuring that the fees are adapted to actual service delivery costs, it aims to support additional uptake while making financial services more accessible to more Philippines.
BSP -Governor quotes the strength of the financial sector, promises of the reform of the reform
BSP’s legislative efforts to improve digital transactions are part of a broader strategy to strengthen the financial system, which the central bank said closed in 2024 with strong speed.
In his report on Philippine financial system During the second half of 2024, BSP emphasized the continued growth of monitored financial institutions, including banks, trust operations and foreign exchange deposits. These profits, said it, have enabled institutions to continue to deliver important financial services to both households and companies.
“BSP’s political reforms and collaboration, together with the improvement of macroeconomic and industry prospects, have enabled monitored units to expand and meet the Philippines’ developing economic needs,” said BSP Governor Eli M. Remolona, Jr. statement. “These efforts support a more resilient financial system.”
The report attributed to the sector’s broad growth to a broader network for financial services and progress within digital platforms. These trends, BSP noted, improves customer experiences and increases the reach of financial services, including underwritten and remote communities.
BSP also described its continued focus on protecting the system against Economic crime and Cyberhot. This focused on the roll -out of improved monitoring monitoring monitoring and financing risks for terrorism, as well as a cyber resilience roadmap and updated regulatory methods for money service companies and mortgage stores.
In addition, the lifting by the moratorium was cited in the establishment of digital banks as a forward -looking step, which strengthened BSP’s commitment to innovation while maintaining surveillance.
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