Philippines central bank proposes 12-month freeze on new payment-system operator registrations and tighter VASP controls

The Bangko Sentral ng Pilipinas (BSP) has proposed a 12-month suspension of new operators of payment systems (OPS) registrations while it reviews its licensing framework. For PSPs serving high-risk merchants, the more immediate change is the BSP’s push to route regulated virtual asset service providers (VASPs) through direct merchant arrangements with tighter due diligence, monitoring, and settlement limits.

1. The BSP said in a draft circular that it would suspend acceptance and processing of applications for OPS registrations for 12 months to carry out a “holistic review” of its taxonomy and licensing framework.
2. Applications submitted before the suspension would still be reviewed, but the BSP would not approve or deny them until the pause ends. Entities would also be barred from starting activities that require OPS registration unless the regulator specifically authorizes them.
3. For merchant acquiring, the proposal would require BSP-supervised institutions offering merchant acquisition services to handle regulated VASPs through direct merchant arrangements. Those relationships would be subject to enhanced due diligence and monitoring, transaction and settlement limits, and other risk-based controls.
4. The requirement would apply to virtual asset firms that must be licensed, registered, or authorized by the BSP, the Philippine Securities and Exchange Commission, or another authority. In the draft, VASPs sit alongside gambling businesses, gaming providers, adult-oriented businesses, and money service businesses.
5. If finalized, the draft circular would take effect 15 days after publication. The BSP is currently accepting feedback.

For high-risk operators, the key detail is not just the registration freeze. It is the BSP’s willingness to harden the rules around merchant acquisition for VASPs, which usually means more friction in onboarding, more controls in ongoing monitoring, and less room for payment chains that are not mapped cleanly to a direct merchant relationship.