MANILA, Philippines – The Bangko Sentral ng Pilipinas (BSP) on Thursday announced it is closing for two years the applications for new non-bank electronic money issuers (EMI).
In a statement, the BSP said the moratorium will be imposed beginning December 16.
“The Monetary Board decided to recalibrate the approach in handling applications from non-bank institutions for new EMI licenses in line with the thrust of the Bangko Sentral to promote financial stability and strengthen public confidence in the digital economy,” it said.
The central bank said the approach involves the closure of the regular application window for new EMI-Others license for non-bank financial institutions for a period of two years and the introduction of the test-and-learn pathway for innovative e-money solutions that offer strong value propositions.
“This strategic change will enable the Bangko Sentral to monitor the performance of current market players and the risks they pose to the financial industry. This will also allow us to assess their impact in relation to our financial inclusion and digital payments transformation objectives,” said BSP Governor Benjamin Diokno.
The BSP said all applications it received until December 15, 2021 will be processed on a first-come, first-served.
“These will be assessed for completeness and sufficiency of documentation/information submitted as well as compliance with other applicable requirements,” it added.
Applications received until December 15, 2021 with noted deficiencies will be returned and considered closed, the central bank said.
New applications beginning December 16, 2021 will no longer be entertained, it added.
The BSP said the policy approach introduced the test-and-learn pathway for new non-bank EMI applicants with new business models, unserved, targeted niches, and/or (new technologies.
“In particular, said applicants may still participate in the digital payments and financial ecosystem by requesting for exception under the Test-and-Learn / Regulatory SandboxFramework,” it said.
“The specific guidelines governing new non-bank EMI applications under the Regulatory Sandbox Framework shall be covered by a separate issuance,” it added.
Diokno explained that the policy decision “reflects our commitment to espouse an enabling environment for responsible and responsive innovation in the financial industry.”
“At the same time, we will be able to ensure that the business environment continues to serve the public interest, allow healthy competition among market players, and foster safe and interoperable payments for the digital economy,” he added.
As of end-October 2021, the BSP said there are already 35 licensed non-bank EMls, which is more than three times the number of players in 2019.