The Bangko Sentral ng Pilipinas (BSP) has proposed that banks and financial institutions under its supervision waive service fees for personal electronic fund transfers and payments to micro, small, and medium enterprises (MSMEs) as part of its initiative to shift the country towards a cash-lite economy.
In a draft circular currently open for feedback from stakeholders, the BSP aims to eliminate costs associated with person-to-person digital transfers and micro-merchant payments. BSP-supervised financial institutions (BSFIs) have until October 11, 2024, to submit their comments on the proposal.
The policy, which is expected to take effect on April 1, 2025, after approval by the Monetary Board (MB), would require payment service providers (PSPs) to adjust their systems to comply with the new rules. The BSP clarified that the fee exemption applies to personal transactions as long as they fall within certain limits, such as being used for personal, family, or household purposes and not exceeding 10 transfers per week.
“This is part of our commitment to ease the burden of transaction costs on individual users and small businesses,” the BSP said in a statement.
The regulator also highlighted that MSMEs, defined as businesses with monthly gross receipts not exceeding P250,000, would benefit from zero-fee digital payments. However, for transactions outside these thresholds, the BSP advised that BSFIs should apply fair and market-based pricing models.
The initiative comes at a time when digital payments are becoming increasingly prevalent in the Philippines. BSP data showed that digital payments accounted for 52.8% of the country’s retail transactions in 2023, surpassing the central bank’s initial goal of 50%.
Bank of the Philippine Islands (BPI) President and CEO, Jose Teodoro Limcaoco, expressed support for the BSP’s plan, stating, “In general, the concept is on the right track. We’ll be submitting our feedback on some clarifications, but overall, it’s a positive step.”
Once PSPs prove their compliance with the circular, the moratorium on fee increases for InstaPay and PESONet transactions will be lifted. Currently, InstaPay fees range from P8 to P75, while PESONet fees can go as high as P600.
