No price cap on money transfer – BSP
MANILA – The Bangko Sentral ng Pilipinas has discounted the possibility of any price cap on electronic money (e-money) transfer, saying this would prevent competition, the Philippine News Agency reported.
BSP Deputy Governor Nestor Espenilla said e-money transfer is “a very ideal solution” for text-savvy people like Filipinos, saying there are still large numbers of people who are still unbanked.
He said e-money transfer entities are becoming strong competition of the regular money transfer companies as well as banks since the former offers cheaper transfer fees.
He explained that “e-money merchants have replicated the functions of automated teller machines.”
Under this system, one can go to an e-money merchant to send money to his beneficiary by giving the recipient’s name, address and phone number. The recipient will then receive a text message with a confirmation code, which he should show to an e-money merchant to get the money.
Espenilla said several money transfer companies have reduced their transaction fees to entice more customers.
He stressed that without competition, money transfer companies will impose high transaction fee to the detriment of the public.
“That is why we don’t want to regulate and impose price cap. Rather than price cap, let competition come in,” he pointed out.
To date, BSP-regulated e-money merchants are Smart Money, an entity owned by Smart Communications; and G-Cash, owned by Globe Telecommunication.
