The Bangko Sentral Pilipinas (BSP) has proposed tighter merchant-screening requirements for payment service providers after identifying thousands of accounts allegedly linked to illegal activities, including unregistered online casinos.
Central bank surveillance found apparently ordinary businesses accepting thousands of payments late at night and into the early morning. Transactions were sometimes as low as PHP50 ($0.80), while merchant descriptions included beauty salons, bakeries and small local stores.
Authorities subsequently determined that some payments were wagers placed with online casinos.
More than 8,000 merchant accounts have been closed over suspected illegal activity, according to BSP Deputy Governor Mamerto Tangonan. The central bank said the measures are intended to address fraud, money laundering and other unlawful transactions.
Under a draft circular, payment providers would be required to collect additional information about merchants, including ownership details and relevant licences. Providers would also need to establish databases of verified legitimate merchants. Repeated failures could lead to the revocation of payment licences.
PAGCOR Chairman and CEO Alejandro Tengco said the gaming regulator was aware that some businesses with innocuous names were operating as unregistered online casinos and was cooperating with the BSP. Tengco added that PAGCOR did not directly control the payment arrangements.
The findings also highlight the role of merchant aggregators, which connect large numbers of small businesses to formal payment channels. Although these intermediaries support financial inclusion, rapid onboarding can create additional compliance risks.
Digital payments represented approximately two-thirds of Philippine retail transactions in 2025, compared with 57% in 2024 and 10% in 2018. Maya and the EMoney Association of the Philippines expressed support for measures intended to strengthen the safety and integrity of the payments system.
The proposal comes amid broader changes to the Philippine gaming market. Electronic gaming revenue declined 22.43% year on year during Q1 2026, following restrictions affecting payments, advertising and platform access.
A recent analysis examined whether the online sector can recover after moving from record growth towards tighter regulatory and responsible gambling controls.
Digital payments accounted for approximately two-thirds of Philippine retail transactions in 2025, up from 10% in 2018
