New BSP chief meets bankers in bid to remove fees for electronic money transfers

Metro Manila (CNN Philippines, September 15) —The Bangko Sentral ng Pilipinas (BSP) has moved to formalize its bid to remove fees for small-value electronic fund transfers among banks and soon, among fintech giants GCash and PayMaya.

BSP Governor Eli Remolona Jr. said he has set a meeting with the powerful Bankers Association of the Philippines (BAP) this Friday for that purpose.

There have been earlier efforts by the central bank to dismantle transaction fees being charged by banks and other financial institutions that range between P8 and P25 per transaction via InstaPay, a real-time electronic fund transfer facility being operated by BancNet.

“We’re talking to the BAP on Friday about payments in general. We’ll have some discussions. And out of that, we’d expect something more formal to come out," Remolona said on Thursday.

"The discussions for now are with the BAP, but we’re also in touch with the GCash, with PayMaya, with digital payments providers," he also said. "That will come.That will be part of the whole payments' framework."

But for the most part, Remolona’s predecessors had been only using so-called “moral suasion” to convince lenders to waive those fees.

“So far yes, it is moral suasion," Remolona said. "It works to a large extent – moral suasion. But we’re formalizing it into a whole payments' framework."

Formalizing the removal of fund transfer fees would be a breakthrough and comes early into Remolona’s term as BSP governor.

Remolona took over the central bank’s helm in July and will head the BSP with a six-year term.

He also said that three big banks have already waived fees on small fund transfers up to P1,000 per transfer.

“We’re trying to shame the other major banks into following the same policy," he said. "We want to make sure that the poor don’t subsidize the rich."

"If you have a credit card and you spend a lot, you get rewards," he explained. "Guess who pays for those rewards? It’s the small guys who only charge a small amount."

Remolona made those remarks on the sidelines of the 2023 Alliance for Financial Inclusion (AFI) Global Policy Forum that the central bank hosted in Pasay City.

At least 700 bankers and other delegates from 70 nations participated in the event, the BSP said.