Digital payment should be fast, secure, convenient, and affordable
The Bangko Sentral ng Pilipinas has ended its freeze on digital payment fee increases for InstaPay and PESONet, choosing not to hold prices still indefinitely but to let them breathe within carefully drawn boundaries. The move, formalized in late June 2026, reflects a quiet acknowledgment that sustainable systems require honest pricing — and that protecting consumers means shaping markets, not merely suppressing them. For a nation still drawing millions into formal finance, the question of what it costs to move money is never purely technical; it is a question about who gets to participate.
- Fee increases for two of the Philippines' most-used digital payment rails are now permitted after years under a moratorium, creating immediate pressure on how banks price everyday transactions.
- Small merchants and ordinary senders face the most exposure, which is why the new rules carve out zero-fee protections for small business payments and set ceilings on person-to-person transfers.
- The BSP is not stepping back but repositioning — requiring institutions to justify every charge with cost data, and reserving the right to demand explanations when periodic filings look suspicious.
- Finance Secretary Frederick Go is pushing the industry toward a PHP10–20 fee standard, calling current highs of PHP50 excessive and signaling active negotiations to compress costs further.
- The policy lands as a calculated wager: that regulated price flexibility will attract investment and innovation, while guardrails prevent the fee creep that has historically driven users away from formal financial systems.
The Bangko Sentral ng Pilipinas has lifted its moratorium on fee increases for InstaPay and PESONet, the two digital payment systems most Filipinos rely on for everyday transfers. The decision, formalized through Memorandum No. M-2026-025 and accompanied by BSP Circular No. 1238, takes effect immediately — but comes wrapped in conditions designed to prevent the freedom to raise prices from becoming a license to exploit users.
The core principle of the new framework is cost-reflectivity: banks and payment processors may only charge what the service genuinely costs them to provide. Small merchant payments must remain free of charge. Person-to-person transfers must be priced within defined limits. And because digital transactions are inherently cheaper to process than over-the-counter ones, they must always be priced lower than their manual equivalents. Institutions are required to disclose fees under existing rules, and the BSP can compel any bank to justify its pricing structure if its filings raise concern.
Finance Secretary Frederick Go added a sharper edge to the conversation, expressing frustration with fees that reach as high as PHP50 and calling for a new normal between PHP10 and PHP20. He is already in talks with industry players and framed the government's ambition in four words: fast, secure, convenient, and affordable.
The BSP's underlying logic is that a permanently frozen price structure discourages the investment needed to improve digital infrastructure, while an unregulated one invites the kind of gradual fee inflation that erodes public trust. The new rules attempt to hold both risks at bay — allowing prices to move, but only in ways grounded in reality and oriented toward the widest possible access. In a country still working to bring millions into formal finance, the cost of a single transaction carries weight far beyond its peso value.
The central bank of the Philippines has ended a freeze on price increases for two of the country's most widely used digital payment systems, but not without conditions. On June 17, the Bangko Sentral ng Pilipinas issued new rules designed to keep those fee hikes in check, requiring banks and payment processors to price their services fairly and transparently, tied to what it actually costs them to operate.
The decision came through Memorandum No. M-2026-025, which formalized a Monetary Board resolution from four days earlier. The lifting of the moratorium on InstaPay and PESONet fee increases takes effect alongside BSP Circular No. 1238, a broader set of amendments to how the country regulates retail payments and merchant acceptance. The central bank framed the move as a necessary step toward a more sustainable pricing environment—one that could adapt to real costs while still protecting consumers and encouraging digital adoption.
At the heart of the new framework is a simple principle: banks must charge what the service actually costs them to provide, no more. The rules require financial institutions supervised by the BSP to adopt pricing mechanisms that are both reasonable and grounded in market conditions. Crucially, the framework mandates zero fees for small merchant payments, a protection for the smallest businesses. For person-to-person transfers—the everyday payments that ordinary Filipinos make to each other—the new pricing structure is designed to bring fees down and establish clear limits on what providers can charge.
The circular also establishes a hierarchy of costs. Digital payments, because they are more efficient and cheaper to process than traditional over-the-counter transactions, must be priced lower than their manual equivalents. Banks remain obligated to disclose all fees to customers according to existing disclosure rules from 2018. If the central bank reviews a bank's periodic filings and suspects the fees are unreasonable, it can demand that the institution justify its pricing structure or face further scrutiny.
Finance Secretary Frederick Go, speaking at a recent briefing, signaled that the government wants to push even further. He expressed frustration at transaction fees that climb as high as 50 pesos, calling that excessive. The normal range, he suggested, should sit between 10 and 20 pesos. Go said he is already in talks with industry players about ways to drive costs down further, and he emphasized that consumers should only bear the cost of switching between providers—not the basic mechanics of moving money. "Digital payment should be fast, secure, convenient, and affordable," he said, naming the four pillars the government sees as essential.
The lifting of the moratorium reflects a broader policy calculation at the central bank. Officials believe that allowing prices to adjust—within guardrails—will create a more stable market for digital payments over the long term. A frozen price structure, they argue, discourages investment and innovation. But a completely unregulated one invites the kind of fee creep that erodes consumer trust. The new rules attempt to split the difference: prices can move, but only if they reflect reality, and only if they move in ways that benefit the broadest possible group of users. For a country still working to bring millions of people into the formal financial system, the stakes of getting this balance right are substantial.
Notable Quotes
Digital payment should be fast, secure, convenient, and affordable— Finance Secretary Frederick Go
The lifting of the moratorium enables a more responsive and sustainable pricing environment, while ensuring that adequate regulatory oversight and consumer protection mechanisms remain firmly in place— Bangko Sentral ng Pilipinas
The Hearth Conversation Another angle on the story
Why did the central bank decide to lift the freeze now, after holding it in place?
The argument is that a permanent freeze doesn't work. Banks need to adjust prices as their costs change, and innovation requires some flexibility. But the old system had no guardrails, so fees could drift upward without justification.
So the new rules are the guardrails?
Exactly. Banks have to show their work now. They can't just raise fees because they want to. The price has to track the actual cost of providing the service.
What about the person who just wants to send money to their family in the province?
That's the segment the central bank is most focused on protecting. Person-to-person transfers are getting their own pricing structure, designed to bring fees down. And for small merchants—the sari-sari store owner—fees are zero.
The Finance Secretary mentioned 50-peso fees. Is that common?
He was pointing to the high end of what he's seen. He thinks 10 to 20 pesos should be the standard. The fact that he's pushing for further reductions suggests the market hasn't naturally settled at that level yet.
Can the central bank actually force banks to lower fees?
Not directly. But it can demand justification for pricing it deems unreasonable, and it can require disclosure so customers know what they're paying. The real leverage is transparency and the threat of regulatory action.
Does this help or hurt ordinary Filipinos?
The intent is to help. Cheaper digital payments mean more people can afford to use the system instead of cash. But it depends on whether the guardrails actually work or whether banks find ways around them.