ONLINE payment schemes and transactions are now officially regulated by the Bangko Sentral ng Pilipinas (BSP) under the newly signed Republic Act (RA) 1127, or the Payment Systems Regulation Act.
Malacañang announced on Thursday the law was signed by President Duterte on October 30, 2018.
BSP is now required to ensure the concerned operators will be responsible for the maintenance and operation of a safe, efficient and reliable payment systems using international standards.
Only those with the necessary financial resources, technical expertise and reputation will be granted by the BSP a license to operate such payment systems.
“The licensing process shall include, but not limited to, an assessment of the ownership, structure, governance, key personnel, business model, risk management, and financial resources,” according to the law.
BSP may accredit a governing body for a specific payment system for the purpose of self-regulation.
RA 1127 also grants the monetary body the authority to operate and own a payment system.
The much-awaited legislation will mandate all payment systems operators listed in the law to register with the BSP within six months from the effectivity of the Act. The Monetary Board will then prescribe a “reasonable period” for new payment systems operators that will register after the said deadline.
It may “designate” or flag a payment system if it determines that such will pose a “systemic risk” with its continued operation.
The BSP will impose fines on individuals or entities that operate a payment scheme without a license, with the fines not exceeding P1 million for each transactional violation, and P100,000 per day for each continuing violation depending on the gravity of the violation.
Violators of RA 1127 face the following sanctions: fined not less than P200,000 or more than P2 million; imprisonment of not less than two years nor more than 10 years; or both fine and imprisonment at the discretion of the court.
The BSP will issue the implementing rules and regulation of RA 1127 within 60 days from the new law’s promulgation.
RA 1127 will officially take effect 15 days after its publication in the Official Gazette or two newspapers of general circulation.
The BSP has been pushing for the legislation to combat irregularities in unregulated online payment and transactions.