Apple Pay, Google Pay eye expansion in PHL

GLOBAL DIGITAL PAYMENT platforms operated by tech giants Apple and Google are looking at expanding in the Philippines, a Bangko Sentral ng Pilipinas (BSP) official said.

“They (Apple and Google) were exploring. They’re exploring and then we had a discussion on their activities,” BSP Deputy Governor Mamerto E. Tangonan told reporters late on Monday.

Mr. Tangonan said Apple and Google would need to register with the BSP as an operator of payment systems (OPS).

“Because of that, we deem them as operators of payment systems, therefore, they need to register. That is our guidance to them,” he said.

The central bank defines an OPS as “any person who provides clearing or settlement services in a payment system, or defines, prescribes, designs, controls or maintains the operational framework for the system.”

The OPS performs functions such as maintaining or operating the platform that enables payments or fund transfers and providing a system that processes payments on behalf of any person or the government, among others.

As of Nov. 29, there are a total of 296 OPS registered with the BSP.

Mr. Tangonan said that there have been no formal applications yet from either of the mobile payment services.

Becoming an OPS would just require registration, he said. “You register and then you can render the service… we don’t license them; we just require registration.”

There is also no other requirement apart from the registration process, he added.

“From our point of view, that’s the requirement, to register. They aren’t merchants, they don’t hold peoples’ funds.”

The registration process is also not difficult, he added, noting that it typically takes one month to complete the process.

“It’s clear to us that they touch the payment system. They perform something. So, therefore they are operators.”

Apple Pay and Google Pay use near-field communication�� technology to enable contactless payments. Apple Pay is only compatible with Apple devices while Google Pay is used for Android phones.

In Southeast Asia, Apple Pay and Google Pay are currently available in Malaysia, Singapore and Vietnam. Google Pay is also present in Cambodia.

Users would need to link the payment system to their bank accounts, Mr. Tangonan explained.

“You need an account to debit. It’s either a deposit account or a credit card account. It depends on what the customer links. E-money could also be used, as long as it’s a stored value account.”

Under the National Payment Systems Act, the BSP has oversight authority over all payment systems in the country and has the right to exercise supervisory and regulatory powers for the purpose of ensuring the stability and effectiveness of the monetary and financial system. — Luisa Maria Jacinta C. Jocson