[Finterest] BSP Ends Freeze on Digital Transfer Fees: What to Expect Next?

The Bangko Sentral ng Pilipinas (BSP) has lifted its five-year freeze on digital transfer fees for services like InstaPay and PESONet, signaling a shift in the regulatory landscape of electronic payments.

This decision, effective from June 17, 2026, follows Memorandum No. M-2026-025 and Circular No. 1238, which allow payment service providers to adjust their fees under a new pricing framework.

A Shift Towards Targeted Pricing

While the moratorium's end raises questions about increased consumer fees, the BSP emphasizes that the goal is to create a pricing structure that lowers costs for users.

The lifting of the moratorium is grounded in the implementation of zero fees for small merchant payments, and the establishment of a pricing structure for person-to-person electronic fund transfers under the Circular which aims to reduce fees for this segment and provide parameters for responsible pricing and market conduct.

Bangko Sentral ng Pilipinas

• Fees for InstaPay and PESONet transactions currently range from P5 to P50.
• New rules require banks to justify their fees based on actual costs.

Historically, the BSP implemented the freeze in 2021 to support the growing shift towards cashless transactions during the pandemic, a move aimed at protecting consumers as they adapted to new digital payment platforms.

Under the revised framework, providers must adopt a fair market-based pricing mechanism. This includes ensuring that small merchants can accept digital payments without incurring fees.

Government Push for Lower Fees

Finance Secretary Frederick Go has advocated for a pricing model where fees could be as low as P2 to P5 per transaction. His vision aligns with the BSP's goal of making digital payments more accessible.

Despite these efforts, reducing fees remains complex due to the various costs associated with transaction processing, including network fees and cybersecurity.

In 2024, Bank of the Philippine Islands (BPI) President Jose Teodoro Limcaoco suggested that banks could benefit from a conditional reduction in reserve requirements in exchange for offering zero interbank transfer fees.

Current BSP Governor Eli Remolona Jr. has expressed caution regarding using reserve requirement reductions as an incentive, preferring to focus on market competition to drive fees down.

As digital payment options expand, the BSP and the government are working to strike a balance between encouraging innovation and protecting consumer interests.