The Bangko Sentral ng Pilipinas (BSP) has lifted its five-year freeze on digital transfer fees, allowing lenders to adjust pricing for the country’s primary electronic fund channels.

According to Memorandum No. M-2026-025, the Monetary Board (MB) approved “the lifting of the moratorium on increase of fee for InstaPay and PESONet transactions,” removing a ceiling the BSP had imposed back in 2021.

Under the previous rule, BSP-supervised financial institutions (BSFIs) were prohibited from raising fund transfer fees; only reductions or waivers were permitted. The new memorandum took effect on Wednesday, June 17.

The BSP noted that lifting the moratorium is “grounded in the implementation of zero fees for small merchant payments.”

Furthermore, the central bank said the updated policy facilitates the “establishment of a pricing structure for person-to-person (P2P) electronic fund transfers (EFTs).” It also seeks to lower consumer costs while setting strict guidelines for fair pricing and responsible market conduct.

The regulatory shift arrives alongside structural updates to the National Retail Payment System (NRPS) Framework, as outlined in BSP Circular No. 1238. This parallel rollout “enables a more responsive and sustainable pricing environment” while ensuring that “adequate regulatory oversight and consumer protection mechanisms remain firmly in place,” according to the memorandum.

Under Circular No. 1238, the BSP mandates that banks align their transaction fee structures with actual operational expenses. The central bank is demanding high accountability for how these charges are calculated, stating that “the pricing mechanism must be adequately supported by an analysis of the actual costs incurred in delivering electronic payment products and services.”

To sustain operations across all parties, merchant fees must remain “reasonable, transparent, market-based, and proportionate to the cost of the services offered.” The required cost reviews must factor in specific overhead categories—such as IT infrastructure, clearing costs, and fraud prevention—which must be made fully available for BSP oversight.

Furthermore, the BSP strictly prohibits price-fixing, noting that pricing structures must not stem from “non-competitive agreements with other BSFIs to fix the price of product or service delivery.”

Among the most notable provisions is the absolute protection of the transacted principal for individual users. “For P2P EFTs, recipients shall receive the full amount as credit to their accounts, free of any charges or deductions,” the BSP stated.

Additionally, fees for cross-transfers between different financial entities must align closely with transaction fees within the same bank or e-wallet, effectively closing the gap between “off-us” and “on-us” fund transfers. To drive wider digital adoption among Filipinos, the BSP urged institutions to keep electronic payments significantly cheaper than traditional banking or over-the-counter (OTC) alternatives.

For merchant activities, operators of payment systems with merchant acquisition licenses (OPS-MAL) are now required to “establish and record the true identity of their merchants and their beneficial owners.” These mandatory sanctions screening measures are expected to heavily curb digital financial crimes.

If valid grounds arise—such as a violation of the governing agreement or suspicious transaction patterns—operators must cut ties with the merchant immediately and report the activity to the Anti-Money Laundering Council (AMLC).