The Bangko Sentral ng Pilipinas (BSP) has lifted its moratorium on issuing electronic money (e-money) licenses to nonbank financial institutions. This move, announced last December 16, 2024, is expected to accelerate digital payment adoption, increase competition, and enhance financial inclusion in the Philippines.
Why BSP Lifted the Moratorium on E-Money Issuers
In November 2021, the BSP imposed a moratorium on granting new licenses to stabilize the e-money sector. While some companies were allowed to operate under regulatory sandbox conditions, the central bank temporarily restricted the entry of new nonbank e-money issuers.
Now that the moratorium has been lifted, more financial players can apply for an EMI license in the Philippines. The BSP aims to:
- Expand the digital payment ecosystem
- Promote financial inclusion in underserved areas
- Encourage competition and innovation in the industry
What Is an EMI License?
An EMI license (Electronic Money Issuer license) allows companies to offer e-money services, such as cashless transactions, fund transfers, and digital payments. E-money is stored electronically and can be used through mobile wallets, prepaid cards, and online payment platforms.
In the Philippines, banks and non-bank financial institutions can apply for an EMI license from the BSP. The recent policy change opens the market to new nonbank entrants, which could lead to more digital payment options for Filipinos.
EMI License Requirements in the Philippines
To secure an EMI license in the Philippines, applicants must meet strict criteria set by the BSP, including:
1. Market research
A clear demand for the service must be demonstrated.
2. Ownership and governance transparency
Companies must disclose their structure and leadership.
3. Capital and risk management
Strong financial resources and risk controls must be in place.
These measures ensure that new players offer secure and reliable services while complying with BSP regulations.
Impact on the Digital Payment Industry
The removal of the moratorium is expected to reshape the electronic money issuer landscape. As of 2023, 42 nonbank and 27 bank e-money issuers were in the country. With more competitors entering the market, digital payment services could become more affordable, innovative, and accessible.
The BSP’s latest data shows that 52.8% of retail payments in 2023 were digital, surpassing its initial target of 50%. The rise of platforms like GCash and Maya has increased trust in cashless transactions, and the trend is expected to continue.
How This Change Supports Financial Inclusion
One of the BSP’s main goals is to make digital payments accessible to all Filipinos, especially those in rural and unbanked areas. By allowing more nonbank electronic money issuers to operate, the BSP hopes to:
- Provide alternative banking solutions for individuals without access to traditional banks
- Reduce reliance on cash transactions, which can be costly and inefficient
- Encourage the use of mobile wallets and digital banking services
What’s Next for the E-Money Sector?
With the moratorium lifted, the BSP is setting the stage for a cash-lite economy driven by digital payments. More companies will likely enter the e-money space, leading to:
- Increased competition – More choices for consumers
- Better services – Faster, more efficient digital payment solutions
- Lower transaction costs – More affordable cashless options
Conclusion
The BSP’s decision to lift the moratorium on new nonbank e-money issuers marks a significant step toward a more digital and inclusive financial system. As more companies apply for an EMI license in the Philippines, consumers can expect a broader range of digital payment services that make transactions easier, faster, and more accessible.
This move aligns with the BSP’s long-term vision of a technology-driven and financially inclusive economy.
Frequently Asked Questions (FAQs)
1. What does EMI mean in finance?
EMI stands for Electronic Money Issuer, referring to entities that provide digital payment solutions by storing and transferring e-money through mobile apps, prepaid cards, and online platforms.
2. How do I get an EMI license in the Philippines?
Applicants must meet capital requirements, governance standards, cybersecurity policies, and risk management frameworks to obtain an EMI license from BSP.
3. What is the difference between a bank and a nonbank EMI?
A bank EMI is a licensed bank that provides e-money services, while a nonbank EMI is a fintech company or financial institution that issues electronic money but does not operate as a traditional bank.
4. What are the benefits of lifting the EMI license moratorium?
The move will increase competition, drive fintech innovation, improve financial access, and help expand digital payments across the Philippines.
5. What is the future of electronic money in the Philippines?
The Philippines’ e-money sector is expected to grow rapidly, with more players introducing innovative financial solutions to meet consumer demands.
6. Is e-money safe to use?
Yes, e-money transactions are regulated by the BSP, ensuring security measures, fraud protection, and consumer rights compliance.
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