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SMART
Communications Inc., Globe Telecom Inc. and other
so-called e-money providers are required to obtain
special dispensation from the Bangko Sentral ng
Pilipinas (BSP) if they want to pursue the business.
According to Deputy BSP Governor Nestor Espenilla Jr.,
this is part of ongoing efforts to put order in a
fast-growing sector of the telecommunications industry
where the potential for abuse is high.
He told
reporters in an e-mail there is a need to put into a
compact set of rules an ad-hoc body of regulations
governing providers of e-money services at present.
“We’re
preparing a circular that would provide the framework
for e-money service providers. Right now we have an
ad-hoc framework; we want to put everything down
formally,” said Espenilla, who heads the powerful
supervision and examination sector.
The
circular will cover consumer protection, regulatory
principles, as well as prudential measures, he added.
Globe’s
GCash product and rival SmartMoney dominate the service,
but other players have ventured into the lucrative
business after the two made it widely available to the
public.
According to Espenilla, there is a need to regulate
e-money service because entities that sell electronic
cash are effectively holding public money.
“When
you buy an e-money card, the person selling that, in
effect, holds public money. The e-money issuer becomes a
holder of public money,” Espenilla said.
He said
the Monetary Board approved the plan for e-money service
providers to obtain a separate license from the BSP to
continue to sell the service.
This
means that fly-by-night operators will be weeded out and
only those with proper technology and capital can do
business in this field.
Since a
license from the BSP is now required, applicants need to
pass registration standards over which they also must
pass the scrutiny of the Anti-Money Laundering Council,
Espenilla said.
The
council is headed by BSP Governor Amando Tetangco Jr.
with the heads of the Insurance Commission and the
Securities and Exchange Commission as members.
Espenilla said the e-money business is getting
widespread, and with so many players out there, a
certain sense of order has to prevail.
“That is
why we need the regulatory framework,” he said. |
