BSP digital transfer fees are entering a new phase after the Bangko Sentral ng Pilipinas (BSP) officially lifted its five-year moratorium on increases for InstaPay and PESONet transactions.
Effective June 17, through Memorandum No. M-2026-025, BSP-supervised financial institutions can once again adjust fund transfer charges under a stricter pricing framework that prioritizes transparency, competition, and consumer protection.
While the move allows banks and payment providers greater flexibility in setting fees, it is accompanied by new safeguards that require charges to reflect actual operating costs.
Together with the implementation of zero fees for small merchant payments, the policy could reshape the economics of digital payments and influence how banks, fintech companies, merchants, and consumers embrace a more cashless future.
A shift from fee freeze to fair pricing
The BSP first imposed the moratorium in 2021 to encourage digital payment adoption during the pandemic, preventing financial institutions from increasing transfer fees while allowing only fee reductions or waivers. With digital payments now firmly established, the central bank is transitioning toward a pricing model that balances market sustainability with affordability.
Under BSP Circular No. 1238, banks and electronic payment providers must now justify their pricing based on actual operational expenses, including technology infrastructure, payment switching, fraud prevention, clearing costs, and regulatory compliance. The BSP also requires pricing to remain reasonable, transparent, market-based, and proportionate to the services delivered.
To preserve healthy competition, the regulator prohibits financial institutions from engaging in price-fixing or coordinated fee-setting arrangements. Instead, institutions are expected to compete through efficiency, innovation, and customer experience rather than relying on arbitrary transaction charges.
Winners, losers, and a new competitive landscape
The updated framework presents opportunities for both consumers and businesses. One of the most significant changes is the implementation of zero fees for eligible small merchant payments, reducing the cost of accepting digital transactions for micro, small, and medium enterprises (MSMEs). Lower payment acceptance costs could encourage more merchants to adopt QR-based and other cashless payment solutions.
Consumers also gain stronger protection under the new rules. For person-to-person electronic fund transfers, recipients must receive the full amount transferred without deductions. The BSP is likewise seeking to narrow the pricing gap between transfers within the same institution and those sent across different banks or e-wallets, making digital transfers more consistent regardless of the destination account.
However, the new environment could pressure banks and payment providers that have relied on transaction fees as a revenue source. As margins tighten, many institutions may need to focus on value-added services such as digital lending, embedded finance, subscription-based offerings, or premium banking experiences to sustain profitability.
Building a more trusted digital payments ecosystem
Beyond pricing reforms, the BSP is strengthening the integrity of the country’s digital payments ecosystem. Operators of payment systems with merchant acquisition licenses are now required to verify the identities of merchants and their beneficial owners while conducting sanctions screening and enhanced monitoring against suspicious activities.
If operators identify fraudulent behavior or violations of merchant agreements, they are required to terminate the relationship and report suspicious transactions to the Anti-Money Laundering Council (AMLC). These measures aim to strengthen trust in digital financial services while protecting consumers and businesses from financial crimes.
Taken together, the pricing reforms and tighter oversight signal that the BSP is pursuing more than lower transaction costs. The central bank is laying the foundation for a digital payments ecosystem that is affordable, competitive, secure, and sustainable.
Looking ahead
The lifting of the BSP’s five-year fee freeze marks a turning point for the Philippine digital payments industry. Rather than simply allowing higher transaction fees, the central bank has introduced a more balanced regulatory framework that combines pricing flexibility with stronger accountability and consumer safeguards.
As banks, fintech firms, e-wallet providers, and merchants adapt to the new rules, competition is likely to shift toward delivering better services instead of competing solely on pricing. If implemented effectively, the reforms could accelerate cashless adoption, improve financial inclusion, and support the continued growth of the country’s digital economy.
