BUSINESS
Advocates Philippines
Bangko Sentral Amends Guidelines on Electronic Money and Operations of E-money Issuers
Photo credit: Bangko Sentral ng Pilipinas
The Bangko Sentral ng Pilipinas (BSP) has amended its Guidelines on Electronic Money (E-money) and the Operations of Electronic Money Issuers (EMI) to ensure that electronic money issuers in the country are equipped to tackle the evolving needs of consumers and the increasing IT related risks. The new guidelines are aimed at promoting the resilience of EMIs and safeguarding the interests of E-money account holders.
Under the revised regulations, EMIs with a monthly outstanding E-money balance of at least PHP 100 million are required to maintain liquid assets equivalent to at least 50% of their outstanding balance and to cover the remaining balance with bank deposits, government securities, or other liquid assets. EMIs with a lower outstanding E-money balance are required to hold eligible liquid assets.
The new rules also set higher minimum capital requirements for EMIs with large-scale operations, recognizing the higher risk exposures of these entities. The minimum capital requirement for large-scale EMIs is PHP 200 million while that for small-scale EMIs is PHP 100 million.
The BSP has also lifted the PHP 100,000 monthly aggregate load limit and now allows EMIs to set predefined limits and thresholds per client category based on their institutional risk assessment and customer due diligence process. The guidelines have simplified the classification of EMIs into two categories: EMI-Banks and EMI Non-Bank Financial Institutions. The definition of E-money has also been expanded to include transfers to other accounts and its acceptability has been broadened to include merchants and issuers using the same mobile application.
EMIs will have one year from the effective date of the revised regulations to comply. Governor Felipe Medalla said that the amendments reaffirm the BSP's commitment to promoting a safe, secure, and inclusive financial system in the Philippines.
Under the revised regulations, EMIs with a monthly outstanding E-money balance of at least PHP 100 million are required to maintain liquid assets equivalent to at least 50% of their outstanding balance and to cover the remaining balance with bank deposits, government securities, or other liquid assets. EMIs with a lower outstanding E-money balance are required to hold eligible liquid assets.
The new rules also set higher minimum capital requirements for EMIs with large-scale operations, recognizing the higher risk exposures of these entities. The minimum capital requirement for large-scale EMIs is PHP 200 million while that for small-scale EMIs is PHP 100 million.
The BSP has also lifted the PHP 100,000 monthly aggregate load limit and now allows EMIs to set predefined limits and thresholds per client category based on their institutional risk assessment and customer due diligence process. The guidelines have simplified the classification of EMIs into two categories: EMI-Banks and EMI Non-Bank Financial Institutions. The definition of E-money has also been expanded to include transfers to other accounts and its acceptability has been broadened to include merchants and issuers using the same mobile application.
EMIs will have one year from the effective date of the revised regulations to comply. Governor Felipe Medalla said that the amendments reaffirm the BSP's commitment to promoting a safe, secure, and inclusive financial system in the Philippines.
Feb 8, 2023
