The Bangko Sentral ng Pilipinas (BSP) has reaffirmed its stance on lowering digital transfer fees under Circular No. 1238, s. 2026, rejecting concessions for banks and e‑wallets that rely heavily on these charges.
The central bank insists that uniform rules are necessary to prevent inefficiencies and ensure fair treatment of consumers.
Echoes of BSP Circular 1238
According to media reports, on July 21, 2026, BSP Deputy Governor Mamerto Tangonan emphasized that Circular No. 1238 must be uniformly applied to all institutions
The circular requires that fees for interbank and inter‑wallet transfers must not materially differ from intra‑bank transfers, which are typically free.
Circular No. 1238 specifically mandates that fees for person‑to‑person digital fund transfers between accounts held at different institutions must not materially differ from intra‑bank transfers.
Since intra‑bank transfers are generally free, interbank fees must only reflect the cost of the network switch operator (InstaPay or PESONet).
The circular prohibits fee structures that unfairly subsidize one group of users at the expense of another. It also requires transparency in fee disclosures, ensuring consumers understand the cost of each transaction.
The BSP clarified that allowing exceptions would create inefficiencies, distort competition, and undermine consumer trust in the digital payments’ ecosystem.
Why is There a Need to Reiterate?
The BSP’s restatement comes amid lobbying by some institutions that argued compliance was costly and operationally challenging.
The regulator’s goal is to ensure that digital transfers are affordable, predictable, and accessible, thereby accelerating the country’s transition toward a cash‑lite economy. By reaffirming its position, the BSP stresses that consumer welfare and financial inclusion outweigh institutional concerns.
Banks and E-wallets are Joining the Trend
Major banks and e‑wallets have announced compliance with Circular 1238.
BDO Unibank, BPI, Metrobank, UnionBank, Security Bank, GCash, Maya, and GrabPay have either lowered or waived fees for small transfers.
BSP reports that most supervised institutions have adjusted their systems, though some smaller rural banks and niche e‑wallets continue to struggle with implementation.
Hindrances Institutions Face to Lower Fees
Compliance has been strongest among large institutions with robust IT infrastructure; however, smaller players face challenges in absorbing lost revenue.
Institutions that rely heavily on transfer fees as a revenue stream face challenges in adjusting their business models.
Smaller banks may lack the infrastructure to absorb costs, while e‑wallets with thin margins struggle to offset lost revenue. Operational bottlenecks, legacy IT systems, and dependence on third‑party providers also hinder compliance.
For rural banks, limited digital adoption among customers further complicates the business case for investing in compliance.
Implementing compliance requires investment in IT systems, integration with InstaPay and PESONet, and adjustments to pricing models.
While institutions bear these costs, the benefits accrue to consumers, small businesses, and the broader economy.
Lower fees encourage digital adoption, reduce reliance on cash, and support BSP’s goal of a more inclusive financial system. The government benefits from improved transparency and traceability of transactions, which strengthens anti‑money laundering efforts.
In the long run, the cost of compliance is outweighed by the long‑term gains in efficiency, trust, and inclusion.
Lowered Fees: A Win for Filipinos
The nation’s public sentiment has been overwhelmingly positive.
Consumers welcomed lower or waived transfer fees, particularly for small transactions, as these costs previously discouraged digital adoption.
Social media reactions highlight that reduced fees make e‑wallets and online banking more accessible, especially for low‑income users. Business groups also praised the move, noting that it reduces friction in commerce and remittances.
The public sees the BSP’s stance as a pro‑consumer measure that directly benefits households and small businesses.
Preliminary reports from banks and e‑wallets show a sharp increase in digital transfers following the fee cuts.
BSP noted that institutions have also signed up new customers after requiring acceptance of the national ID as sufficient proof of identity for account opening. This indicates that lower fees directly contribute to higher transaction volumes and broader financial inclusion.
Data from InstaPay and PESONet show double‑digit growth in transaction volumes since the implementation of Circular 1238, confirming that affordability drives adoption.
Cashless PH Economy in the Making
The BSP’s insistence on lowering or eliminating transfer fees under the circular is not simply a regulatory adjustment—it is a strategic lever to accelerate the Philippines’ transition toward a cashless economy.
Historically, one of the biggest barriers to digital adoption has been the cost of moving money electronically. When consumers are charged ₱15–₱25 per transfer, many prefer to withdraw cash and transact physically, undermining the efficiency of digital channels.
The moment near-zero fees become mandatory, the BSP removes this friction point and makes digital payments the default choice rather than a costly alternative.
International experience supports this view. In countries like India, where the Unified Payments Interface (UPI) eliminated transfer fees, digital transactions surged exponentially, overtaking cash in many urban centers.
The Philippines is now positioned to replicate this trajectory.
With fees waived or lowered, consumers are more likely to use e‑wallets for everyday purchases, remittances, and bill payments. Small businesses, which previously hesitated to accept digital payments due to cost concerns, can now embrace cashless transactions without fear of losing margins.
The road to a cashless economy, however, requires more than just fee reduction. Infrastructure reliability, merchant acceptance, and consumer trust must also be strengthened.
Yet fee elimination is a powerful catalyst—it declares to the public that digital payments are not only convenient but also economically rational.
As transaction volumes rise, network effects will reinforce adoption, creating a virtuous cycle where more users attract more merchants, and more merchants attract more users.
In this context, no transfer fees become more than a consumer benefit—they become a national policy tool.
If the cost of participation is lowered, the BSP can ensure that digital finance is accessible to all segments of society, from urban professionals to rural households. This inclusivity is the cornerstone of a cashless economy, where every Filipino can transact seamlessly without the burden of hidden costs.
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