Money service businesses given more time to comply with tighter req’ts

The Bangko Sentral ng Pilipinas (BSP) has given money changers, remittance agents, and foreign exchange dealers more time to comply with tighter requirements as it extended the validity of existing registration permits for three more months.

The central bank has approved the second extension of the transitory period on the effectivity of previously issued certificates of registration (COR) held by money service businesses (MSB).

“The three months extension will provide pawnshops and MSB a grace period to file their application for re-registration with the BSP,” the central bank said in a statement.

In January last year, the BSP issued Circular 942 announcing the cancellation of previously issued certificates of registrations of MSB on Aug. 10. However, the regulator issued Circular 968 in August granting a five-month extension or until Jan. 31 this year, giving MSB more time to gather complete and updated documentary requirements.

With the second extension, the BSP said the transitory period on the effectivity of the Acknowledgment of Registrations (AOR) issued to pawnshop operators in January last year would be extended to April 30.

Likewise, the effectivity of the COR issued to remittance and transfer companies, money changers, and foreign exchange dealers was also extended to April 30.

Upon the expiration of the transitory period, the central bank said all previously issued COR would be considered automatically cancelled, unless otherwise extended by the BSP.

“All pawnshops and remittance transfer companies, money changers, forex dealers are required to secure their authority to operate a pawnshop business or MSB, respectively, on or before April 30. Otherwise, their AOR or COR shall be considered automatically revoked/cancelled,” the BSP said.

As of June 2016, there are more than 18,000 BSP-registered MSB comprising of 5,300 head offices and 12,700 branches. Of the total number about 6,700 are also BSP-authorized pawnshops.

The MSB in the Philippines is continuously growing and evolving to support the expanding needs of its customers. It now includes, among others, the electronic money business subsidiaries of telecommunication companies.

In January last year, the BSP also approved an updated comprehensive framework aimed at enhancing BSP oversight over the operations of MSBs to promote more effective compliance with the AntiMoney Laundering Law.

Under the new rules, the BSP would regulate all remittance and transfer companies such as remittance agents, remittance platform providers, and e-money Issuers.

Since MSBs are numerous but generally interconnected, BSP adopted a network-based regulatory approach.