The Bangko Sentral ng Pilipinas is moving to tighten merchant onboarding rules for e-wallets and QR Ph payments after uncovering what it described as a broad scheme involving illegal online gambling operators. According to the central bank’s surveillance, thousands of unlicensed gambling businesses were able to process transactions on local digital payment platforms by presenting themselves as ordinary small merchants such as bakeries, beauty parlors, and sari-sari stores.

The draft rules would shift clear responsibility to payment platforms for checking the businesses on their networks. The BSP’s message is that the convenience and speed of digital payments can no longer come at the expense of weak merchant screening, especially as electronic transactions account for a growing share of everyday retail activity in the Philippines.

Why the BSP is tightening the rules

The issue centers on how illegal operators allegedly entered mainstream payment systems through false merchant identities. The BSP said online gambling businesses were able to register on e-wallet platforms under the guise of legitimate neighborhood enterprises, allowing illicit betting payments to move through standard consumer-facing channels.

That discovery prompted the central bank to propose a stricter framework for merchant verification. The aim is to make it harder for payment accounts and QR-based payment acceptance tools to be used for unlawful activity while reducing the risk of fraud, scams, and money laundering within the broader digital payments ecosystem.

Merchant aggregators under closer scrutiny

Part of the BSP’s focus is on merchant aggregators, third-party intermediaries commonly used by e-wallet providers to recruit and onboard businesses. These firms helped expand digital payments quickly, particularly among smaller merchants, by signing them up to payment networks and earning incentives for each new account.

But the central bank’s findings suggest that rapid expansion also created gaps in due diligence. Under the draft guidelines, payment operators would no longer be able to rely loosely on aggregator-led onboarding if illegal merchants slip through. Instead, the operators themselves would be directly accountable for the businesses connected to their systems.

What platforms would be required to do

Under the proposed rules, e-wallet operators would need to collect and verify fuller documentation for every linked merchant. The required checks include confirming the identity of the business owner, reviewing valid government permits and licenses, and checking registration records against centralized databases of legitimate businesses.

The BSP also signaled that enforcement could escalate beyond routine compliance findings. If a payment platform repeatedly fails to prevent illegal activity on its network, the operator could ultimately face the loss of its payment license, raising the stakes for internal controls and merchant monitoring.

Broader industry backdrop and next steps

The proposal comes as digital payments have become a dominant retail channel in the country. The share of retail transactions made digitally reached nearly two-thirds in 2025, up from 57% in 2024 and only 10% in 2018, according to the figures cited in the report. That growth has increased both the importance of e-wallet infrastructure and the pressure on operators to show that scale has not outpaced safeguards.

The industry response described in the report was broadly supportive. Maya and the EMoney Association of the Philippines said tighter oversight is necessary to protect the payments ecosystem. The article also noted that Mynt, parent of GCash, is preparing for what it described as a record initial public offering, while Maya is considering a listing of its own. The next confirmed step is the BSP’s draft-rule process, which would set the formal compliance expectations for merchant vetting on e-wallet and QR payment networks.

Source: bitpinas.com