MANILA, Philippines — The Bangko Sentral ng Pilipinas (BSP) is proposing tighter integrity controls across the country’s payment system, including a 12-month freeze on new Operator of Payment Systems (OPS) registrations and stricter requirements for payment flows involving virtual asset service providers (VASPs).

The measures are contained in an exposure draft circular titled “Regulations to Strengthen Integrity Controls in Payment Transactions,” which is currently open for industry feedback.

The proposal comes as digital and QR-based payments continue to expand, with the BSP seeking greater visibility over merchants, intermediaries, accounts and settlement flows.

If finalized, the circular would take effect 15 days after publication, with the OPS registration freeze beginning on its effectivity date.

Crypto Payment Flows Face Tighter Controls

One of the draft’s most significant changes concerns how payment processors interact with regulated VASPs.

Merchant acquirers would be required to maintain direct contractual relationships with regulated VASPs, while multi-tiered or layered payment aggregators that obscure the merchant, ultimate beneficiary or movement of funds would be prohibited.

The draft also classifies VASPs as high-risk merchants, placing them alongside other activities subject to heightened controls.

This would bring enhanced due diligence and transaction monitoring requirements, as well as limits on transaction and settlement activity.

The proposed structure is designed to give payment providers clearer visibility into who is receiving funds and how those funds move through the payment network.

BSP Proposes Centralized QR Merchant Database

The draft would also establish a National QR Code Merchant Database covering merchants that accept payments through the national QR Ph standard.

The database would contain information including:

• Unique merchant identifiers
• Ownership and beneficial ownership details
• Licensing status
• Settlement accounts
• QR credentials
• Risk classifications
• Merchant status, including active, restricted, suspended or terminated

Changes in a merchant’s status would have to be promptly disseminated to relevant payment service providers, allowing them to conduct immediate risk reviews.

The proposed database is intended to give payment providers and regulators a centralized, real-time reference for identifying merchants and responding to emerging risks.

A Shift Toward End-to-End Traceability

Taken together, the measures target a common problem in digital payments: opacity created by multiple layers of intermediaries.

The BSP says the proposed controls would help eliminate structures that can obscure the source or destination of funds and improve accountability across merchants, intermediaries, accounts and settlement channels.

That visibility is intended to support faster detection and coordinated responses to fraud, scams, money laundering, terrorist financing, sanctions breaches and other illicit activity.

For crypto-related payments, the direct-relationship requirement would make it more difficult for transactions to move through several intermediary layers without a clear connection to the underlying merchant or beneficiary.

OPS Registration Freeze Adds a Broader Regulatory Reset

The proposed 12-month suspension of new OPS registrations adds another layer to the draft.

Rather than targeting only specific transaction types, the measure would temporarily halt new OPS registrations while the BSP overhauls its licensing taxonomy and risk guidelines.

The freeze would begin once the final circular takes effect and last for 12 months.

Existing operators would not simply disappear from the system. Instead, the broader framework would place greater emphasis on how payment providers are categorized and how risks are managed within the payment ecosystem.

The Implementation Timeline

The proposed QR database would be rolled out in stages.

The BSP would establish an interim repository within 90 days, followed by a full production database within 12 months.

Complete migration and validation of active merchant records would take place within 15 months.

Separately, the OPS registration freeze would run for 12 months from the circular’s effectivity date.

If the exposure draft is finalized, the circular itself would take effect 15 days after publication.

Still Subject to Industry Feedback

The proposed measures have not yet taken effect.

The BSP is currently seeking industry feedback, meaning the provisions could still be revised before a final circular is issued.

The proposal nevertheless signals a broader regulatory direction: as payment channels become faster, more digital and increasingly interconnected, the BSP is looking to pair that growth with stronger requirements for identifying merchants, tracing funds and responding to risk.

For crypto payments and QR transactions in particular, the proposed framework would place greater emphasis on knowing who is behind a transaction and maintaining visibility across the payment chain.

‍