Digital Payment Fees: BSP Lifts Moratorium, Go Pushes for P2-P5 Transfers

Key Takeaway

• 🏦 BSP Lifts Moratorium: The Bangko Sentral ng Pilipinas has lifted the fee-hike freeze on InstaPay and PESONet transactions, allowing banks to set new pricing under a cost-based framework.
• 📱 Zero Fees for Merchants: The new framework introduces zero fees for small merchant payments and aims to reduce person-to-person transfer costs.
• 💰 Go’s P2-P5 Goal: Finance Secretary Frederick Go wants to slash interbank transaction fees from the current P10-P50 range to just P2-P5 per transaction.
• 🏦 LandBank Leads: LandBank reduced its InstaPay fee to P8 from P15 and launched a pilot program waiving convenience fees for government transactions via QRPh.
• 📉 Impact on OFWs: Lower digital transaction fees could significantly reduce the cost of remittances and everyday digital payments for millions of OFWs and their families.

The Bangko Sentral ng Pilipinas (BSP) has lifted its moratorium on increases in fees for transactions made through InstaPay and PESONet, marking a significant shift in the country’s digital payment landscape. The move, which comes alongside the implementation of Circular No. 1238, introduces a new pricing framework aimed at making digital payment more affordable while ensuring banks can cover their actual costs. For the millions of OFWs who rely on digital payment channels to send remittances and pay bills, the changes could have a direct impact on how much they pay for everyday financial transactions.

What the BSP’s New Framework Means

In Memorandum No. M-2026-05, the BSP said the Monetary Board approved the removal of the fee-hike freeze alongside Circular No. 1238, which amends the National Retail Payment System Framework and the Regulatory Framework for Merchant Payment Acceptance Activities.

“The lifting of the moratorium is grounded in the implementation of zero fees for small merchant payments and the establishment of a pricing structure for person-to-person electronic fund transfers under the Circular, which aims to reduce fees for this segment and provide parameters for responsible pricing and market conduct,” the memorandum read.

Circular No. 1238 provides that service fees for electronic payments should be reasonable, transparent, and proportionate to the actual cost of providing the service. “The pricing mechanism should be designed to uphold fairness across end-user groups,” the circular stated.

The new framework represents a balancing act. On one hand, banks need to cover the costs of maintaining digital infrastructure, cybersecurity, and compliance with regulatory requirements. On the other hand, excessive fees can discourage the adoption of digital payments, particularly among low-income users and OFWs who send small but frequent remittances.

The BSP’s approach introduces cost-based pricing, which means banks must justify their fees based on actual service costs rather than arbitrary pricing. This transparency should help consumers understand what they’re paying for and encourage competition among providers to offer lower rates.

Finance Secretary Go’s Push for Lower Fees

The development comes as Finance Secretary Frederick Go seeks to slash interbank transaction fees to as low as P2, with discussions already underway with the BSP and key players in the financial industry. Go has made reducing the cost of digital payments one of his top priorities, citing the high fees Filipinos pay for fund transfers, government transactions, and remittances.

“Digital payment should be fast, secure, convenient, and affordable. We’ve been talking to them (the BSP) about this. We want to level the playing field,” Go told reporters. “I believe the BSP has the same sentiment on how to bring down transaction costs.”

His goal is ambitious: bring transfer fees down from the current P10 to P50 range to around P2 to P5 per transaction. If achieved, this would represent a 50-90% reduction in transfer costs — a significant saving for Filipinos who make multiple digital transactions each month.

Still, Go acknowledged that extensive consultations with stakeholders are needed before any industry-wide changes can be implemented. He also challenged members of Fintech Alliance PH to develop solutions that would reduce remittance costs. “You just need one of the big players to drop. Then people have to compete. Then we drop the convenience fees. That will add pressure on agencies that continue to collect high convenience fees,” he said.

While the finance chief has no direct authority to regulate fees imposed by banks and digital payment providers — a function that falls under the BSP — Go said his office has already directed the Land Bank of the Philippines, which he chairs, to start lowering charges.

LandBank Leads by Example

Effective May 21, LandBank reduced its InstaPay fee for person-to-person transactions to P8 from P15 — a 47% reduction that immediately benefits millions of Filipinos who use the state-run bank for digital transfers. The state-run lender has also launched a pilot program that waives convenience fees for eligible person-to-government transactions made through QRPh-enabled channels.

The pilot program will run until the end of the year, with Go saying the goal is to make the initiative permanent as long as “it makes financial sense for LandBank.” This pilot is particularly significant because government transactions — including tax payments, permit fees, and social benefit disbursements — represent a large volume of digital payments in the Philippines.

LandBank’s move sets a benchmark for other banks and digital payment providers. When a major government-owned bank reduces fees, it creates competitive pressure on private banks and fintech companies to follow suit. For OFWs who use LandBank for remittances and bill payments, the savings are immediate and tangible. The bank’s reduced InstaPay fee of P8 is now among the lowest in the industry, and other banks may be forced to match or beat this rate to retain customers.

What This Means for OFWs and Remittances

The BSP’s new framework and Go’s push for lower fees have direct implications for overseas Filipino workers. Digital transaction fees are a significant component of the total cost of sending remittances to the Philippines. Currently, an OFW sending money home through InstaPay or PESONet may pay P10-P50 per transaction in bank fees, plus additional charges from remittance service providers.

If Go’s vision of P2-P5 transfer fees is realized, OFWs could save hundreds of pesos per month on remittance costs alone. For a worker sending P10,000 home twice a month, the difference between P50 and P5 per transaction translates to P90 per month or over P1,000 per year in savings — money that stays in the pockets of Filipino families.

The impact extends beyond remittances. OFWs who pay Philippine bills digitally — including utilities, insurance, loan payments, and government fees — will also benefit from lower transaction costs. The zero-fee policy for small merchant payments could also reduce the cost of everyday purchases made by families back home through digital channels.

According to the Bangko Sentral ng Pilipinas, digital payment transactions in the Philippines grew by over 40% in 2025, with InstaPay and PESONet processing billions of pesos in monthly transactions. The growth is driven by increasing smartphone adoption, government digitalization efforts, and the expanding OFW remittance market.

For OFWs choosing between remittance providers, the new fee environment makes it more important than ever to compare costs. Services like GCash, Maya, and traditional banks are competing aggressively on fees, and the BSP’s cost-based pricing framework should make it easier for consumers to identify the most affordable options. Learn more about choosing the best remittance service for OFWs in our comprehensive guide. Also check our digital banking guide for OFWs to understand the full range of digital financial services available.

The Broader Digital Payments Landscape

The Philippines has emerged as one of the fastest-growing digital payments markets in Southeast Asia. The BSP’s National Retail Payment System (NRPS) framework, launched in 2015, has created the infrastructure for interoperable digital payments across banks and non-bank electronic money issuers.

InstaPay, which enables real-time, low-value electronic fund transfers, has become the preferred channel for person-to-person remittances and small business payments. PESONet, which handles batch-processed, higher-value transfers, is commonly used for salary payments, supplier payments, and government disbursements.

The lifting of the fee moratorium signals the BSP’s confidence that the digital payments market has matured enough to handle market-driven pricing. During the moratorium period, the BSP used the fee freeze to encourage digital adoption and give banks time to optimize their systems. Now that digital payments are mainstream, the central bank believes competition and cost-based pricing will naturally drive fees down.

The World Bank has consistently highlighted the importance of affordable digital financial services for financial inclusion. In the Philippines, where over 10 million OFWs send remittances annually, reducing transaction costs is a key factor in ensuring that more money reaches families rather than being absorbed by fees.

How OFWs Can Benefit From Lower Digital Fees

The push for lower digital transaction fees comes at a critical time for OFWs. Remittance costs have long been a concern for the global Filipino diaspora, with the World Bank estimating that the average cost of sending $200 to the Philippines remains above 5% when including all fees and exchange rate margins. Reducing the domestic component of these costs — the fees charged by Philippine banks and payment providers — can make a meaningful difference.

Beyond remittances, lower digital fees benefit OFWs in several practical ways. Paying Philippine bills digitally — including utilities, insurance premiums, loan amortizations, and government fees — becomes more affordable. Small business owners in the Philippines who receive digital payments from OFW relatives also benefit from lower transaction costs, keeping more money in the local economy.

The zero-fee policy for small merchant payments is particularly significant for families in rural areas, where small sari-sari stores and market vendors increasingly accept digital payments. When these merchants don’t have to pay fees on small transactions, they can keep prices lower for consumers — a direct benefit for OFW families managing household budgets. Explore our money management guide for OFWs to learn more about maximizing your overseas earnings.

For OFWs planning their financial future, the evolving digital payments landscape also creates new opportunities. Lower transaction costs make it more practical to invest small amounts regularly through digital platforms, building savings and investment portfolios over time.

Frequently Asked Questions (FAQ)

Q: What did the BSP announce about digital transaction fees?
A: The BSP lifted its moratorium on fee increases for InstaPay and PESONet transactions. Banks can now set new pricing under a cost-based framework that requires fees to be reasonable, transparent, and proportionate to actual service costs. The framework also introduces zero fees for small merchant payments.

Q: What is Finance Secretary Go’s target for transaction fees?
A: Finance Secretary Frederick Go wants to slash interbank transaction fees from the current P10-P50 range to P2-P5 per transaction. He is working with the BSP and financial industry players to achieve this goal through stakeholder consultations.

Q: How much has LandBank reduced its fees?
A: LandBank reduced its InstaPay fee for person-to-person transactions to P8 from P15 effective May 21, 2026. It also launched a pilot program waiving convenience fees for eligible person-to-government transactions through QRPh-enabled channels.

Q: How will lower transaction fees affect OFW remittances?
A> If transfer fees are reduced to P2-P5, OFWs could save hundreds of pesos per month on remittance costs. For someone sending money home twice a month, the savings could exceed P1,000 per year. Lower fees also benefit families making digital payments for utilities, bills, and government transactions.

Q: What are InstaPay and PESONet?
A: InstaPay is a real-time, low-value electronic fund transfer system for person-to-person remittances and small payments. PESONet handles batch-processed, higher-value transfers commonly used for salary payments and government disbursements. Both are part of the BSP’s National Retail Payment System.

Q: When will the new fee structure take full effect?
A: The BSP’s new framework is effective immediately, but the full impact on consumer fees will depend on how quickly banks and payment providers adjust their pricing. Finance Secretary Go’s P2-P5 target requires further stakeholder consultations and may take several months to implement industry-wide.

Disclaimer: This article is for informational purposes only and does not constitute financial or investment advice. Digital transaction fees and policies are subject to change. OFWs should verify current fees with their banks or remittance providers before making financial decisions.