Guidelines on the Submission of the Documentary and Reportorial Requirements under BSP Circular No. 1198

BANGKO SENTRAL NG PILIPINAS OFFICE OF THE DEPUTY GOVERNOR I PAYMENTS AND CURRENCY MANACEMENT SECTOR M EMORAN DUM NO. M-2O24-O37 To: Operators of Payment System (OPS) Subject : Guidelines on the Submission of the Documentaryand Reportorial Requirements under BSP Circular No.ll98 Pursuant to Republic Act (R.A.) No. lll27 or the National Payment Systems Act and Circular No. ll98 on the Flegulatory Framework for Merchant Payment Acceptance Activities (MPAA) dated 19 July 2024, all covered OPS engaged in or intending to engage in MPAA shall observe the following guidelines in the preparation and electronic submission of the documentary requirements in the transitory provisions and reportorial requirements under the said Circular. A. General Guidelines l. All subject OPS shall electronically transmit reportorial requirements to the corresponding email addresses using the prescribed format in accordance with Appendix A of this Memorandum. An acknowledgement receipt for the submitted report will be sent by the appropriate department of the Bangko Sentral. 2. All subject OPS granted with Merchant Acquisition License (OPS-MAL) shall use the prescribed report templates which can be downloaded from the BSP websiteror directly requested from BSP following the prescribed format in accordance with Appendix B of this Memorandum, 3. Fleport submissions that do not conform with the prescribed format and procedures shall not be accepted and will be considered non-compliant with the existing reportorial requirements subject to applicable penalties for delayed, erroneous, and/or unsubmitted reporting under Section l03 of the Manual of Flegulations for Payment Systems (MORPS). 4. Queries regarding respective requirements, its related regulations and guidelines shall be sent to the respective email address following the prescribed format for the email subject in accordance with Appendix B of this Memorandum. 5. The reference period refers to the specified timeframe, either a calendar quarter or year, covered within the report or notice. B. TransitoryProvisions l. Within six (6) months from the effectivity of Circular No. 11982, OPS already engaged in MPAA and/or merchant acquisition shall submit the following requirements to the Payment Supervision and Licensing Department (PSLD) of the Bangko Sentral: For OPS that are non-banld non-Electronic Money lssuer-Non-Bank Financial lnstitutions Document Email Address Engaged in MPAA l. Certifi cation of compliance3 psld [email protected]. ph 2. Gap assessmenta Engaged in l. Certifi cation of compl iance3 psld [email protected]. ph merchant 2. Gap assessment4 acquisition I https:/Arurw.bsp gov.ph/SitePages/Regulations/RegulationDisp-aspx?ltemld=5O3? 2 On or before I February 2025 3 Annex B of Circular No. ll98 a Annex C of Circular No. ll98 Page l of4

3. Documentary requirements under the guidelines on the application for Merchant Acquisition License oPs that are Document E-mailAddress Engaged in MPAA l. Gap assessment template4 for psld- the provisions on payment to [email protected] merchants, pricing Copy: Corresponding mechanism, and reportorial Financial Supervision requirements Department if not directly under PSLD supervision Engaged in Ga p assessment tem plate4 psld- merchant for the provisions on [email protected] acquisition payment to merchants, Copy: Corresponding pricing mechanism, and Financial Supervision reportorial req uirements Department if not 2. A Notice of MPAA and other directly under PSLD documentary req uirements supervision (Appendix 505-5) 2. All OPS emails related to the transitory provision shall be electronically submitted using the following prescribed format for the email subject: <OPS Name><space>MPAA Transitory, as illustrated below: Subject : OPS ABC MPAA Transitory C. Reportorial Requirements l. Audited Financial Statements (AFSI a. All subject OPS-MPAA and OPS-MAL shall submit the AFS within one hundred twenty (l2O) business days after the end of reference year. b. AFS shall include the balance sheets, income statements, statements of changes in equity, statements of cash flows, notes to financial statements, and opinion of the external auditor. c. AFS shall be submitted together with a Certification of the External Auditor on: (l) Compliance with relevant confidentiality clauses; (2) Compliance with disclosure requirements and other information that may be required; and (3) Any matter adversely affecting the condition or soundness of the OPS, such as, but not limited to the following cases: (a) any material finding involving fraud or error; (b) actual or potential losses wherein the aggregate of which amounts to at least ten percent (lO%) of the consolidated total assets of the OPS; (c) significant doubt as to the ability of the OPS to continue as a going concern: Page2of 4

(d) material breach of Philippine laws. Bangko Sentral charter (RA. No. 7653 as amended by R.A. No. ll2ll), or Bangko Sentral rules and regulations; (e) material internal control weaknesses which may lead to financial reporting problems; and (f) findings on matters of corporate governance that may require urgent action by the Bangko Sentral. d. OPS-MPAA and OPS-MAL that are Banks or EMI-NBFls under the supervision of the Financial Supervision Sector (FSS) shall copy furnish PSLD of their AFS submission to their respective Financial Supervision Department. 2. Statistics Related to MPAA (Appendix 503-2) a. All subject OPS-MAL are expected to submit three (3) monthly Data Entry Template (DETs) for each reference quarter within fifteen (15) business days after the end of reference quarter. b. All subject OPS-MAL shall submit in Excel format the three (3) monthly MPAA DET to the Payments Policy and Development Department (PPDD) within fifteen (15) business days after end of reference quarter. c. All subject OPS-MAL with no transaction for the month should input zero (O)or null values for the report submissions. d. Statistics related to MPAA shall be submitted by subject OPS-MAL that are not required to submit the Electronic Payments and Financial Services (EPFS) Monthly Report pursuant to Section 5O1.6 of MORPS. e. All subject OPS-MAL that are unable to transmit electronically may submit the DET in any portable storage device (e.g., USB flash drive) through messengerial or postal services within the prescribed deadline addressed to: The Director Payments Policy and Development Department Bangko Sentral ng Pilipinas Ground floor. EFLC Office BSP Complex, A. Mabini Street, lOO4 Malate, Manila 3. List of Delisted Merchants a. All subject OPS-MAL shall submit the list of delisted merchants within fifteen (15) business days after the end of reference quarter. b. With respect to the reason of delisting, subject OPS-MAL should indicate the following reasons as reflected in the template: (l) End of Contract (2) Sale or Lease of Dangerous and/or lllegal Goods (3) Deceptive, Unfair, or Unconscionable Sales Act or Practice (4) Sale of Goods under a Cease-and-Desist Order (5) Failure to Remedy Breach of Contract (6) Failure to Meet Merchant Payment Acceptance Criteria (7) Other Reasons c. All subject OPS-MAL with no delisted merchants for the reference quarter should indicate "Nothing to report" in the prescribed template.

4. Notice of Significant Changes (Appendix 503-3) a. All subject OPS-MAL shall submit to the PSLD a Notice to the Bangko Sentral of significant changes as needed thirty (5O) business days prior to effective date of proposed change. This does not preclude the subject OPS-MAL from compliance with the Notice requirements for registered OPS under Section 502.6 of the MORPS. b. Significant changes include: (l) Changes in ownership, directors, and/or key officers or representatives authorized to officially communicate to the Bangko Sentral; and (2) Any proposed changes to merchant payment acceptance model of the OPS-MAL that are significant or change the risk profile of the business model, which includes but is not limited to any changes in target market, mode of payment acceptance, as well as payment and settlement flow. c. The subject OPS-MAL should submit a Notice that clearly outlines the changes of the subject OPS-MAL, signed by President or officer of equivalent rank of the OPS-MAL, accompanied by relevant supporting documentation. d. OPS-MPAA and OPS-MAL that are banks or EMI-NBFls under the supervision of Financial Superuision Sector (FSS) shall copy furnish PSLD with their submission to their respective Financial Supervision Department regarding any subsequent resignation, retirement, or replacement of directors/officers authorized to officially communicate with the Bangko Sentral. 5. Notice of Change in Average Monthly Value of Collected Funds Transferred to Merchants Resulting to a Change in Categoryof License (Appendix 5(}3-4) a. All subject OPS-MAL shall submit to the PSLD a Notice of change in average monthly value of collected funds transferred to merchants resulting to a change in category of license (Appendix 503-4)within sixty (60) business days after its occurrence, signed by the President or officer of equivalent rank of the OPS-MAL. b. A change in license category is required if the average monthly value of collected funds transferred by an OPS-MAL to its merchants for two consecutive calendar years (e.9., Y2OZ5-2O27 ) falls under a different category, i.e., from Category A to B or Category B to A. c. The reckoning date for com puting a change in category of the average monthly value of collected funds is fifteen (15) business days after the reference year, in fine with the submission of Statistics Related to MPAA (Appendix 5o,3-21. d. Banks and EMI-NBF|s under the supervision of FSS shall copy furnish their respective Financial Supervision Department with their submission to PSLD. For compliance. NT MAMERTO E.ITANGONAN Deputy cLt ernor lo December 2O24

Appendix A: Prescribed Format for Reports Report Title File Name Extension EmailSubject EmailAddress Audited Financial AFS-OPS PDF <Name of OPS><space>AFS,<Reference Period [email protected] I Statements Name in dd Month g4yy> Certification of the Example External Auditor Subiect: OPS ABC AFS,3l December 2024 Statistics Related to MPAA-OPS XLS < Name of OPS-MAL><space>M PAA, ppdd-payme [email protected]. ph MPAA - Data Entry Name <space><Reference Month in dd Month 566ry> Template Copy: psld-reports@bsp,gov.ph Example Subiect : OPS ABC MPAA,3l Auqust 2024 List of Delisted DelistedM < Name of OPS-MAL><space>Delisted Merchants erchants- Merchants, <space><Reference Month in dd OPS Name Month y144y> Example Subject : OPS-MAL ABC Delisted Merchants, 3l August2024 Notice of Significant NoticeSC- PDF <Name of OPS-MAL><soace>Notice of [email protected] h Changes OPS Name Significant Change,<space><Reference Month in dd Month yy5ry> Copy: Corresponding Financial Supervision Department if not Example directly under PSLD supervision Subject OPS-MAL ABC Notice of Significant Chanqe, 3l Auqust 2024 Notice of Change in NoticeCC- <Name of OPS-MAL><space>Notice of Change [email protected] h Average Monthly OPS Name in Capital Category,<Reference Date in dd Value of Collected Month 54447> Copy: Corresponding Financial Funds Transferred to Supervision Department if not Merchants Resultino Examole directlv under PSLD supervision rBanks or EMI-NBFls under the supervision of Financial Supervision Sector (FSS) shall copy furnish [email protected] of their AFS submission to their respective Financial Supervision Department Pagel of3

to a Change in Subject OPS-MAL ABC Notice of Change in Cateqory of License Capital Cateqory,3l Auqust 2024 Appendix B: Prescribed Format and Email Addresses for lnquiries and Requests for Template A. Inquiry on Report Report Title Email Subiect EmailAddress statistics Related to MPAA <Name of OPS-MAL> <space> [|NQUIRYI MPAA ppdd- Statistics paym entsdata @bsp.gov. ph Examole subiecr: oPs ABc ilNQUIRYI MPAA Statistics List of Delisted Merchants <Name of OPS-MAL> <space> [NQUIRY] Delisted Mercha nts Example subiect: oPS ABc IINQUIRYI Delisted Merchants Audited Financial Statements <Name of OPS> <space> [NQUIRY MPAA AFS [email protected] Examole Certification of the External Auditor SUbiECt: OPS ABC TINQUIRYI MPAA AFS Notice of Significant Changes <Name of OPS-MAL> <space> [INQUIRY] MPAA Notice of Significant Changes Example Subject: oPS ABC ilNQUIRYI MPAA Notice of Siqnificant Chanqes Notice of Change in Average Monthly Value <Name of OPS-MAL> <space> [NQUIRY] MPAA of Collected Funds Transferred to Notice of Change in Capital Category Merchants Resulting to a Change in Example Category of License subjecr: oPS ABc ilNQUIRYI MPAA Notice of Change in Capital Cateqory B. Request for Template

Report Title Email Subiect Email Address Statistics Related to MPAA - Data Entry <Name of OPS-MAL> <space> [REQUESII MPAA DET ppdd- Template Examole payme [email protected]. ph Subiect: OPS ABC TREQUESTI MPAA DET List of Delisted Merchants <Name of OPS-MAL> <space> [REQUEST] Delisted Merchants Template Example subjecr: oPS ABC [REQUEST] Delisted Merchants Temolate Notice of Significant Changes <Name of OPS-MAL> <space> [REQUEST] MPAA [email protected] Notice of Significant Changes Examole subject: oPS ABc [REQUEST] N4PAA Notice of Siqnificant Chanqes Notice of Change in Average Monthly Value <Name of OPS-MAL> <space> [REQUEST] MPAA of Collected Funds Transferred to Notice of Change in Capital Category Merchants Resulting to a Change in Example Category of License subject: oPS ABc [REQUEST] MPAA Notice of Chanqe in Capital Cateqorv