The Philippines Central Bank Proposes a 12-Month Freeze on New Payment Operator Registrations

ChainCatcher report: The Bangko Sentral ng Pilipinas (BSP) has issued a proposed advisory to suspend the acceptance of new applications for registration of Payment System Operators (PSOs) for 12 months and to impose stricter controls on payment arrangements involving Virtual Asset Service Providers (VASPs). The BSP stated that this move aims to conduct a comprehensive review of its classification and licensing framework. Under the draft, the BSP will halt the acceptance and processing of new PSO applications during the suspension period; applications submitted prior to the suspension may continue to be evaluated but will not be approved or denied until the suspension ends. Entities are prohibited from engaging in activities requiring PSO registration unless specifically authorized by the regulator. Additionally, BSP-regulated entities providing merchant acquiring services must establish direct merchant arrangements exclusively with licensed VASPs, and such relationships will be subject to enhanced due diligence, transaction and settlement limits, and other risk mitigation measures. These requirements apply to virtual asset businesses licensed, registered, or authorized by the BSP, the Philippine Securities and Exchange Commission, or other regulatory authorities. VASPs are categorized alongside entities engaged in betting, gaming, adult industries, and money services. If finalized, the rule will take effect 15 days after publication, and the BSP is currently seeking public comments.