Philippines Central Bank Suggests Daily Limits on Online Gambling Payments

The central bank of the Philippines (BSP) has released a draft circular proposing daily caps on the amount of money users can transfer to online gambling platforms through digital payment services.

Philippines Central Bank Proposes Online Gambling Payment Limits

The draft circular from the Bangko Sentral Pilipinas proposes that fund transfers to online gaming platforms be limited to no more than 20% of the average daily balance of a user’s transaction account. It also requires payment service providers (PSPs) to automatically reject any transactions that exceed this limit.

In addition, all PSPs and payment system operators currently offering or planning to offer services related to online gambling must obtain prior authorization from the BSP. To be eligible, they must meet specific requirements set by the central bank, including having a robust anti-money laundering and counter-terrorism financing risk management framework.

Additionally, BSP-regulated entities must define a threshold for what constitutes “heavy usage” of gambling-related payment services. Once this threshold is reached, a mandatory 24-hour “cooling-off” period would apply, during which no further transactions can be made. To promote responsible gambling, users who hit this limit will receive mandatory pop-up alerts warning of the associated risks and encouraging responsible behavior. 

The BSP also intends to prohibit financial institutions from offering any lending services when a user’s e-wallet is linked to an online gambling account. Furthermore, digital payment providers would be barred from displaying online gambling advertisements unless a user has explicitly opted in to receive them. Employees of financial institutions would be strictly prohibited from participating in any form of online gambling.

What Else Did the Bank Say?

According to the BSP, it is of utmost importance to prevent the misuse of digital payment services for activities that are socially harmful and damaging to individuals’ financial well-being. The central bank is accepting public comments on the draft circular until July 25, following growing concerns from Church leaders and lawmakers about the rising accessibility and promotion of e-gambling, which they say contributes to addiction and financial hardship, particularly among low-income groups. 

It should be noted that this isn’t the only regulatory action on the gambling sector that the country has been discussing recently. Earlier this month, a proposition was submitted to the Philippine Senate that could see the banning of e-wallets for betting, along with other strict regulations on online gambling.

If approved, the circular will require any BSP-regulated entity seeking to offer payment services for online gambling to obtain prior authorization from the central bank. These entities must meet minimum requirements, including a capitalization of at least ₱300 million (approximately $5,29 million) and the implementation of a robust system to manage risks related to money laundering and fraud. They will have six months from the circular’s effective date to comply and obtain the necessary permits.