Philippines Proposes 12-Month Freeze on New Payment Operator Registrations

The Bangko Sentral ng Pilipinas (BSP) has floated a draft circular proposing a 12-month suspension on all new registrations for Operators of Payment Systems (OPS), effectively freezing the competitive landscape while regulators take a hard look at how these businesses are classified, licensed, and managed.

The proposal also layers on significantly tighter requirements for Virtual Asset Service Providers (VASPs) that facilitate merchant acquisitions, a move that underscores the BSP’s increasingly cautious posture toward crypto-adjacent financial services.

During the proposed 12-month window, which would begin 15 days after the circular is officially published, the BSP would continue evaluating applications already in its pipeline. But those applications would sit in regulatory limbo: no approvals, no denials, just indefinite waiting.

Any entity wanting to engage in OPS-related activities during the suspension period would need the BSP’s prior authorization.

The BSP is currently soliciting public feedback on the draft, which remains a proposal without a finalized implementation date.

The payment operator freeze isn’t happening in isolation. It arrives alongside new requirements specifically targeting VASPs involved in merchant acquisition, the process by which businesses are onboarded to accept payments through a particular platform.

Under the proposed rules, merchant acquirers working with regulated VASPs would be required to establish direct arrangements rather than routing through intermediaries. The BSP wants enhanced due diligence baked into these relationships, with only VASPs that are duly licensed or registered with the BSP, Philippine SEC, or other relevant authorities qualifying for such arrangements.

The central bank is also pushing to improve the traceability of merchant payments through what it describes as a centralized database, paired with an outright ban on intermediary structures in certain transaction flows.

The central bank originally imposed a moratorium on new VASP licenses back in September 2022, and that freeze has been extended indefinitely, with the current expiration pushed to September 2025.

The BSP’s stated motivation centers on improving risk management and consumer safeguards, including concerns about fraud and money laundering. By suspending new registrations, the central bank buys itself time to overhaul its classification framework for payment operators.