Central Bank of Philippines Plans Registration Halt for Payment Operators, Stricter VASP Oversight

Central Bank of Philippines Plans Registration Halt for Payment Operators, Stricter VASP Oversight

The Bangko Sentral ng Pilipinas has put forward a regulatory proposal that would temporarily halt acceptance of new payment operator applications while implementing stricter oversight measures and transaction restrictions for operations connected to virtual asset service providers.

The Bangko Sentral ng Pilipinas (BSP), the central banking authority of the Philippines, has put forward a regulatory proposal that would implement a 12-month freeze on accepting new registrations for payment-system operators while simultaneously establishing more stringent oversight mechanisms for payment arrangements that involve virtual asset service providers (VASPs).

According to the draft circular released by the central bank, the BSP intends to halt the acceptance and processing of new applications from operators of payment systems (OPS) in order to carry out a comprehensive evaluation of its current taxonomy structure and licensing protocols.

Any applications that were filed prior to the implementation of the suspension period would remain eligible for continued evaluation, however, the BSP has indicated it will not issue approvals or denials for any such applications until the moratorium period concludes. Organizations would be prohibited from initiating any activities that necessitate OPS registration unless they receive special authorization from the regulatory authority.

According to the proposed regulations, institutions under BSP supervision that provide merchant acquisition services would be mandated to manage regulated VASPs exclusively through direct merchant arrangement structures. Such business relationships would be required to undergo enhanced due diligence procedures and continuous monitoring, adhere to transaction and settlement limitations, and comply with additional risk-based control mechanisms.

This regulatory requirement applies to virtual asset companies that hold licenses, registrations, or authorizations from the BSP, the Philippine Securities and Exchange Commission, or other relevant regulatory authorities. The draft circular places VASPs in the same category as gambling operations, gaming service providers, adult-oriented commercial enterprises, and money service businesses.

Should the proposal be finalized, the draft regulations would become effective 15 days following their official publication, and the BSP is presently collecting stakeholder feedback during the consultation period.

Cointelegraph contacted the BSP seeking additional information and clarification regarding the proposed measures but had not received a response by the time of publication.