Rules and Regulations on the Registration of Operators of Payment Systems

tlruoxo SENrneL Ne Prurelruas OFFICE OF THE GOVERNOR ctRcuLAR NO.1049 Series of 2019 Subject: Rules and Regulations on the Registration of Operators of Payment Systems The Monetary Board, in its Resolution No. 1350 dated 5 September 2019, approved the rules and regulations on the registration of operators of payment systems to implement Republic Act (R.A.) No. 11127 or the National Payment Systems Act. These rules and regulations shall form part of the newly-created Manual of Regulations for Payment Systems (MORPS). Section 1. Part l, Section 101 of the MORPS shall read, as follows: 101 REGTSTRATTON OF OPERATORS OF PAYMENT SYSTEMS (OpS) Policy Statement. The Bangko Sentral recognizes the crucial role of payment systems in maintaining a stable financial system and facilitating the realization of monetary policy objectives. lt is thus important for the operation of payment systems to be safe, efficient and reliable. Definition of Terms. For purposes of these implementing rules and regulations, the definition of terms under Section 4 of R.A. No. 11127 shall apply. Coveroge. All OPS as defined under R.A. No. LLL27 and clarified in this Section shall register with the Bangko Sentral. For this purpose, an OPS shall be a person that performs any of the following functions: a. Maintains the platform that enables payments or fund transfers, regardless of whether the source and destination accounts are maintained with the same or different institutions; b. Operates the system or network that enables payments or fund transfers to be made through the use of a payment instrument; c. Provides a system that processes payments on behalf of any person or the governmen| and d. Such other activities similar to the foregoing, as may be determined by the Monetary Board. The examples of activities performed by an OPS under the functions set forth above are found in Appendix 1. Requirements for Registrotion. The following rules shall apply to the registration of an OPS pursuant to Section 10 of R.A. No. LLL27. A. [{lhi;-:rSt.. i'lll;'.it 1i)rJ.:l }Janl]i;. i:hilii:cincs. i{:l2i ;Oil-l7a)j . w\.rw.b:it.ij'iv.0l " !:!Ftriil'.r.,t1:ili.Jiav.ci-l

OPS that have yet to commence operations. The following requirements shall apply to an OPS that have yet to commence operations at the date of the effectivity of this Circular: a. Applicotion for Registrotion. An OPS shall submit the following documents and information to the appropriate department of the Bangko Sentral: (1) Duly accomplished Application for Registration (Form 1) signed by the president, chief executive officer, or a senior officer holding an equivalent position; (2) Business Plan, which includes the description of its existing business, business model and target markets; and (3) Copy of the business registration/permit indicating the line of business of the OPS, from the city or municipality that has territorial jurisdiction over the principal place of business of the OPS for the current period. The Bangko Sentral may, in the course of the evaluation of the application for registration, require submission of documents and information in addition to those listed above. b. Fees for Registrotion. Upon the issuance of the Certificate of Registration (COR), an OPS shall pay a registration fee of P 20,000.00. A fee of P 1,000.00 shall be assessed and collected for the replacement of a COR for whatever reason. c. Dote of Registrotion. All OPS that have not commenced operations shall register with the Bangko Sentral within one (1) month from the start of their operations except in the following instances where registration is required prior to commencement of operation: (1) A regulator or government agency requires appropriate action from the Bangko Sentral prior to the start of the OPS business; (2) The OPS offers remittance services as well as other similar activities performed by money servlce businesses; and (3) Such other circumstances, as may be determined by the Monetary Board. OPS that dre currently operoting. The following requirements shall apply to an OPS that is already operating at the date of the effectivity of this Circular: a. Application for Registration. An OPS that has already commenced operations at the date of the effectivity of this Circular shall submit the following documents and information to the appropriate department of the Bangko Sentral: (1) Duly accomplished Application for Registration (Form 1) signed by the president, chief executive officer, or a senior officer holding an equivalent position; (2) Business Plan, which includes a description of existing business, business model, and target markets; and (3) Copy of the business registration/permit indicating the line of business of the OPS, from the city or municipality that has territorial jurisdiction over the place of establishment and operation of the OPS for the current period.

The Bangko Sentral may, in the course of the evaluation of the application for registration, request submission of documents and information in addition to those listed above. b. Fees for Registration. Upon the issuance of the COR, an OPS shall pay a registration fee of P 20,000.00. A fee of P 1,000.00 shall be assessed and collected for the replacement of a COR for whatever reason. c. Date of Registration. An OPS that is currently operating at the time of the effectivity of R.A. No. 11127 shall register with the Bangko Sentral by complying with the registration requirements prescribed under this Section not later than three (3) months from effectivity of this Circular. Bonks ond EMls. The following requirements shall apply to banks and electronic money issuers (EMls) that are currently operating, or will later operate, as an OPS as defined under R.A. No. LLL27 and clarified in this Section: a. Registrotion through Notification. A Bank or an EMI shall submit to the appropriate department of the Bangko Sentral, a notification of its activities as an OPS. lt shall include a description of its existing business as an OPS, business model, and target markets. The submission shall be signed by the president, chief executive officer, or a senior officer holding an equivalent position. The Bangko Sentral may, in the course of the evaluation of said submission, require additional documents and information in relation to said notification. b. Date of Submission A bank or an EMI shall submit the notification with the supporting documents prescribed under this Section not later than three (3) months from effectivity of this Circular, or within one (1) month from the start of their operations as OPS, as appropriate. lssuance of Bangko Sentrol Certificate of Registration (COR). Upon receipt of the duly accomplished Application for Registration (Form 1) and the required documents, or Notification, as the case may be, from the OPS, the Bangko Sentral shall issue a provisional COR (PCOR). lt shall be valid for the period stated therein unless indicated otherwise in the List of PCORs published on the Bangko Sentral website. Thereafter, the Bangko Sentral shall issue a COR to the OPS, if warranted, and provided that the submitted documents satisfy the regulatory requirements. Notice Requirements lor Registered Operotors of Poyment Systems. Registered OPS, except for banks or EMls registered as OPS, shall give notice to the appropriate department of the Bangko Sentral of the following events within five (5) business days from the date of occurrence. a. Commencement of operations for OPS required to register prior to operations. b. Change of ownership or control of the OPS that will result in ownership or control of at least twenty percent (2O%l of the voting shares of stock by any person or which will enable such person to elect, or be elected as, a director of the OPS. The notice shall indicate the details of the change of ownership or control. The change in ownership

or control of OPS of a designated payment system shall also be subject to the approval requirements as may be required by RA No. 11127 and its implementing rules and regulations. Suspension or revocation of permits, licenses or other authorities issued to the OPS by other government agencies. The notice shall include the ground/s for the suspension or revocation, and the action taken or to be taken by the OPS relative to the suspension or revocation. Thereafter, the OPS shall provide bi-weekly updates on the status of the suspension or revocation of its permits, licenses, or other authorities issued by other government agencies. d. Change in key officers or representatives authorized to officially communicate to the Bangko Sentral. e. Change of registered/business name. In case of change in the registered/business name, the Bangko Sentral shall issue a new COR indicating the new registered/business name of the OPS upon its payment of a replacement fee of P 1.,000.00, submission of the amended Articles of Incorporation (AOl) or equivalent document reflecting the new registered/business name and return of the COR issued by the Bangko Sentral to the OPS. Operoting o Poyment System Without Registration. When an OPS required to be registered under this Section is found to be operating a payment system without registration, the Monetary Board shall issue a directive to such OPS to comply with the registration requirements under this Section. lf the OPS remains unregistered, the Monetary Board shall issue an order to such OPS to stop from operating a payment system without registration and to take immediate action to register. The Bangko Sentral may coordinate with other regulators and concerned government agencies to inform them that the said OPS is operating a payment system without registration from the Bangko Sentral. The above is without prejudice to the enforcement actions by the Bangko Sentral, as may be applicable, under existing laws, rules and regulations. Enforcement Actions. The Bangko Sentral may deploy enforcement actions to ensure compliance with the provisions of this Section and bring about timely corrective actions. Any viof ation of this Section shall subject the OPS and/or its directors, officers, and/or employees to the sanctions set forth in Section 37 of R.A. No. 7653, as amended, and Section 19 of R.A. No. 11127, as appropriate. Section 2. Effectivity. This Circular shalltake effect fifteen (15) calendar days following its publication either in the Official Gazette or in a newspaper of general circulation. FOR THE MONETARY BOARD: lnou* Ada FRANCISCO G. DAKILA, JR. Officer-in-Charge ? s"pt"rber 2019

Examples of Activities Performed by an Operator of a Payment System Maintains the platform that enables payments or fund transfers, regardless of whether the source and destination accounts are maintained with the same or different institutions o Owns or operates a computer application system that enables payments or fund transfers o Sets rules by which payments may be made or funds may be transferred o Allows customers to fund their accounts by submitting to the operator cash or its equivalent in exchange for the value to be stored in their account o Allows accounts of system users to be linked to their accounts with other financial institutions (Fls) (e.g., deposit account, e-money account, credit card account) Operates the system or network that enables payments or fund transfers to be made through the use of a payment instrument o Provides a system or network infrastructure that enables payments and financial services of Fls r Sets rules, functions, procedures, arrangements or devices that enable an account holder or holder of the payment instrument to transact with a third party o Transfers payment information (e.9., card transaction details) to and from participating institutions o Provides network participants with a listing of the amounts due toffrom other participants o Offers service/s to more than one (1) Fl and enables them to perform payments or fund transfers among each other o Enables the acceptance of specific payment instrument/s by institutions such as government, com mercial establish ments, and other merchants/bi llers Provides a system that processes payments on behalf of any person or the government o Receives payment for or on behalf of the sellers of goods, providers of services, or creditors/billers in accordance with a written agreement o Sets rules, provides arrangements or facilities to collect funds from the public and transmits the same to sellers of goods, providers of services, or creditors/billers in accordance with a written agreement o Allows payments to be made to more than one commercial establishment or creditor/biller

OPS Form 1 Pegli of2 APPUCATION FOR REGISTRATION AS OPERATOR OF A PAYMENT SYSTEM (OpSl (To be completely fllled up. Indicate 'N/A' if an it€m ls not applicable.) Thru: The offlce of thc Dircctor Date: Paymcnt Swtem OveFEht DeDanment (PSODI Thls form ls to be acomplished by the Operetor of a Payment system (OPSI. An OPS refers to any p€r$n performing any of the actiyitles as deffned fn section 4{l) of R.A. No. 11127 (The llatlonal Payment Syst?ms Acll. Klndly indicote ln the checkltst ot the bock oI thls form the odlvftles pedormed hyyow componv, 1. FUIf COMPAT{Y NATI,IE | 2.TrN 3.COMPANYNAME 4. REGISIERED BUSII{ESSfiRADE NAME/S 5. COMPAT{Y REGISTRANOil'{O. 6. DAIE ISSUED 7.VAilD Ut{Tt[ 8. BUSINESI LOCATIO]{ t trlttlo o gn hrrngi sp.dry SWtto.ondrtut c tu''rgo| | fq/rturr/tipof/ry afr.m-fuanrte 9. BUSTilESS CONTACT |NFO. Lardt ac ttffilleilo. EnoIIfudttst WcDstt 10. BUSINESS PERMIT/ilATURE or ilPE lustr.3sFar|tttflo. Oo'rBtuad VoMaladl xldol!,uiht.'' I Vr',ltr&'.St!,a.'8 oF EUS|I{E5S U. Areyou llcensed to do business In the tr Yes lfyes, lndtcate the type oI llcense lhlllpplnes? ENo isued tothe compony TI. FORM OF BUSII{Ess ORGAT{IZATION 13. AUTHORIZED CAPTTAI STOCK (e.& Sole Proprietorship, Partnershlp, corooEllon- Cooa.retive- atc-l 14. OW]IERIIHIP AI{D MANAGEMET{T STRUCTURE !1.1 Ust of Board of Direaors/Partncrs/Owners tlatt'€ Adzqurtlp Addr?ls ftttt,0'n NH xot EmoilAddtat Ovnrdi,lo 14.2 tlst of Shareholders fwitD ownenhip of ot leost 1096) Ittome a'/tr'.nttfi Addrt6,t ,bti'lo'' ftE xot Er'dlAddr!'6 Ortt 6ttro 14.3 tirt of lGy Otfielr (Presdeng Finance Officer, Treasurer ond their equiwlent) Iloma Athsrrtrp |ddrrs' fgftIo', ft[ EmonAddr6 15. BRIEF DESCRIPT]ON ON HOWTHE BUSINESS OPERATESAT{DTARGETMARKET 15.1 Pim.ry Produd/Servk 15.2 ReEnue Gcncr.dnS Acdvitie3 153 T.[ct Markct (dropdown menu to be rdected by appllcent) a. Trenractiorlr$eilfee b. Subccrlpdon-besedfee c. Ucensefees d. Others (pterse cre.E a ftGld thatcan b€ fflled bv tart) 16. NETWOR( AND OPERANOilS 16.1 llumbcrof branchcs or:eruldn; unlts (ovcr- 16.2 Numbar ot prydent terrnln.ls (sclf-servlcc - 16.3 llumber of partlclpants/ ute6 dr.-countcr/trllcr rslstcdl ATM. P.YmGnt l0osl(sl LT.TYPESOFPAYMEIff I 5JrortDrscdPtbt oJtuW,a,t tlnn Ddq po''aa* Awfigcmdrthtl 4lrarvgamot Wttduaot mlmeof'grsadoac tuKaafbrrt INSIRUMEilTS/MEDIAISSUED @ lshall bc coneidcred thc ofidal c-mrll addrcss rcglstered with gSP

OPs Fom I PegtE2orz APPTICANON FOR REGFTRATION AS OPERATOR OFA PAYMENT SYSTEM (OPS} (To be completely fflled up. Indlcate "N/A" if an item is not applicable) Kindly place a check mark ( v ) beside the actMty/ieE pertormed by your company. A. Maintsint the platform tha? cnables p?ynentr or fund tronstcrs, rcgodless of whether the sourxa ond dcstlnatlon gr;counb ar? molntoined with ?he sme or difierent institutbm tr Owns or operotes o computer opplicatlon system thot enobles poyments orlund tonsfers tr Sets rules by whlch payments moy be mode or funds moy be tronsferred tr Nlows customerstofund their amounts hy submitting tothe operatorcosh orlts equtwlent ln exclnngeforthewlueto be stored in their occount tr Hlows occounts of system users to be llnked to thelr sccounts with other finonctol lnstltutlons (Fts) (e.g. deposft occount, e-money occctunt, credlt cord occount) 8. Operat s ttc system or neharoln. tlrrlt .acbtcs poymllntr or furd f unsftrc b be mode through the use ol o poyrcnt iwtrument tr Provldes o system or network infmstructure thot enobles poymenB ond finonctol sedces ol Fls tr Sets rules, functions, procedures, onongemenE or devices thot enoble on occount hotder or hotder of the pyment instrument b tronssd wlth a third porty tr Tronsfers payment lnformotlon (e.g. cord tronsoction detoils) to and from parttclpottng lnsttttttlons tr Provides network porttclponB wlth o llstlng of the amounts due to/from other portktponr tr Olfen seMce/s to more thon one (7) Fl ond enobles them o perlorm poyment or fund tmnslerc omong eqch other tr Enobles the occeptonce ol specific poyment instrumenVs by tnsdtutions such os gotrernment, ammerciol establishmeng snd other merchonUblllers C. Provides o systcm tlnt proccsse poyncnB on bchall ol any pcrson ot thc govemment tr Recelves po@ent for or on beholl ol the sellers of goods, provlden of serulces, or aeditorclbtllers ln qccordonce wfth o written ogreement tr Sefs rules, proides orrongements or locllltles to colled funds lrom the public and transmiE the same to sellerc of gods, provlderc of servlces, or crediton/billen ln occordance with o wrt't;ten ogreen ent tr Allows poymmB to be mode to more thon one cornmerclol estobllshment or qeditor/biller l, [insert namel, [insert deslgnationJ of [insert company name], hereby certify to the following: 1. I am authorized to siSn thls Application for Registratlon as oPs for and on behalf of [insert company name]. 2. The completion of the Application for Registntlon as OPS was made after conduct of self-assessment whereby it was determlned that [insert company name] is an OPS pursuant to R.A. No. 11127 (The National Payment Systems Act) and BSP Orcular No- As OPS, [insert cornpany name] performs: ftnsert actlvlties performed as an OpS]. 3. (insert company namel ls licensed to do buslness In the Philippines and has obtained the necessary authoritles and -. permits from the relevant government agencles or units to perform the abovernentloned activities. 4, By Indlcating in this registration form the personal lnformation of the Board of Dlrectors, tist of partnem, ownert shareholders, and key officers, said persons are aware of their rights under R,A. No. 10173 (Data Privacy Act of 2012) and they authorize the BSP to collect, process and store thelr personal informatlon and share with and make available this Application for Reglstration to interested parties for lawful purposes and legitlmate lnterests and to comply with legalmandate. 5. The lnformation provided hereln are true, accurate and complete. Name Deslgnation of Authorized Offlcer