MANILA— The Bangko Sentral ng Pilipinas is exploring ways to encourage small scale miners to transact with the central bank and to formalize their entry into the banking system, an official said Friday.

Small scale miners and traders have taken advantage of tax exemptions which took effect in March 2020 by increasing their gold sales to the BSP, the bank's director of Mint and Refinery Operations Department Joseph Norbert David told reporters.

"We are looking at making our rates more attractive to small miners and sellers. We are also looking at minimizing the processing cost," David said.

Currently the Philippine Central Bank mint's main office in Quezon City is required to assay or analyze gold purchases within 13 days.

It is able to do a preliminary assay to assess the value and quality of gold it is purchasing within a few minutes before the payment of 99 percent of the transaction cost.

The fire assay takes longer, because they have to melt down the gold to assess the final pureness of the precious metal. It takes even longer when the gold has to be shipped from the Central Bank’s buying stations around the Philippines.

The volume of gold purchases surged in 2020 compared to the previous year, David said. Meanwhile, this year, the total so far has already exceeded last year's total, he said.

In 2020, BSP Gov. Benjamin Diokno said the central bank would actively trade gold as prices surge due to the "decreasing confidence" in US dollars.

• BSP to 'actively trade' gold as precious metal prices soar

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