Bangko Sentral ng Pilipinas Considers Suspension of New Payment System Operator Registrations
The Bangko Sentral ng Pilipinas (BSP), the country’s central banking authority, is contemplating a significant initiative that would involve a year-long suspension of new registrations for payment system operators. This move aims to implement stricter oversight and transaction restrictions for payment arrangements that engage with virtual asset service providers (VASPs).
Proposed Freeze on Applications
According to a draft circular released by the BSP, the proposed freeze on applications for operators of payment systems (OPS) is intended to facilitate a comprehensive evaluation of the existing licensing framework and operational classifications concerning payment services. While applications that have been submitted prior to this embargo will still be reviewed, no approvals or rejections will be given until the suspension period concludes. Moreover, entities cannot commence activities that require OPS clearance unless explicitly permitted by the central bank.
Regulatory Stipulations for VASPs
In addition, the draft legislation stipulates that institutions under the supervision of the BSP that provide merchant acquisition services must engage regulated VASPs exclusively through direct relationships with merchants. Such partnerships will necessitate enhanced scrutiny through rigorous due diligence and transaction monitoring, as well as the implementation of settlement and transaction limits along with other risk management protocols.
This regulatory stipulation applies to VASPs that seek to operate legally and must obtain licensing, registration, or authorization from the BSP, the Philippine Securities and Exchange Commission, or other governing bodies. Notably, these virtual asset providers are grouped with other high-risk sectors including online gambling, adult entertainment, and money service entities.
Next Steps and Public Input
The proposed measures, if finalized, will become effective 15 days after being published. Currently, the BSP is inviting public input on the draft. Cointelegraph attempted to solicit further commentary from the BSP, but did not receive any response prior to publishing.
Related Regulatory News
In related regulatory news, the Philippine SEC has recently identified several crypto platforms, including dYdX, as unauthorized in their operations.
