MANILA -- The Bangko Sentral ng Pilipinas (BSP) said Thursday it would close the applications for new non-bank electronic money issuers (EMI) on December 16.
Currently, the BSP supervises a total of 65 EMIs, out of which 35 are non-banks such as PayMaya and GCash.
The suspension will allow the central bank to "mitigate the inherent risks" as well as to further understand the technology, BSP Gov. Benjamin Diokno said in a virtual briefing.
The application window will be closed for two years, he said.
The suspension of new non-bank EMI applications is part of the BSP's recalibration of new electronic money issuer licenses, he added.
"There has been a dramatic shift in consumer behavior towards digital payments. Hence, we have to take a proactive stance in terms of safeguarding the public trust," Diokno said.
"This strategic change will enable the Bangko Sentral ng Pilipinas to monitor the performance of current market players and the risk they pose to the financial industry. This will also allow us to assess the impact on BSP’s financial inclusion and digital transformation objectives " he added.
The use of electronic fund transfers such as InstaPay and PESONet surged, in terms of volumes and value, in the last two years due to the COVID-19 pandemic, he said.
COVID-19 helped accelerate the adoption of cashless payments as Filipinos sought ways to complete financial transactions while they're stuck at home.
Applications for digital banking licenses were also suspended in August.
The BSP granted a total of 6 digital banking licenses for the testing phase under the new banking framework.
Despite the recalibration, the BSP has been actively pushing for innovations "that will help heal market gaps" and boost financial inclusion in the country, Diokno said.
Under its BSP Digitalization Roadmap, the central bank aims to digitize 50 percent of payments and encourage at least 70 percent of the population to open bank accounts by 2023.
As the pandemic continues to drive the shift to digital, the BSP also encouraged consumers to only deal with licensed money issuers. Diokno also warned the public against virtual assets.
"We encourage the public to practice good cybersecurity practices especially as our lives become more integrated with the digital economy… Be reminded that virtual assets are not considered legal tender and they are not insured by the Philippine Insurance Corp.," he said.
The BSP earlier ordered Lyka to suspend payment operations until it registered as an Operator of Payment System (OPS).
Meanwhile, other e-wallets and online platforms have been offering cryptocurrencies.
The full list of licensed e-money operators is found on the BSP's official website.