The Bankers Association of the Philippines (BAP) has hailed the Bangko Sentral ng Pilipinas’ ninth wave of foreign exchange liberalization as a way to boost convenience and security in the domestic financial system in line with global trends.
In a briefing Wednesday, HSBC Philippines president Wick Veloso—who also chairs the BAP’s open market committee— said: “The country becomes a safer place to transact because it allows you to deal with financial institutions, makes it convenient for clients to transact. It’s good for the public who needs foreign exchange.”
“With less documentation, bank customers are now able to buy foreign currencies without having to bring out cash from their bank. It also means less chances of getting counterfeit notes,” Veloso said.
The BSP recently allowed retail clients to buy up to $500,000 over-the-counter without documentation while corporations are now allowed to buy up to $1 million without documentation. Previously, retail and corporate clients were allowed access to only up to $120,000 in foreign currency for both trade or non-trade transactions without documentary requirements.
The hike in foreign exchange limit without supporting documents is also seen to enhance and further facilitate access to foreign currencies for legitimate transactions. To recall, the BSP had sought proposals from bankers on how to reform the foreign exchange framework in view of the money laundering scandal involving the Jupiter branch of Rizal Commercial Banking Corp. last April.
The new foreign exchange rules was mapped out in consultation with the open market committee of the BAP headed by Nestor Tan, who is also president of the country’s largest lender BDO Unibank.
In line with this, the BSP also allowed the immediate transfer of foreign currencies purchased by clients from their banks to their foreign exchange deposit unit (FCDU). Previously, clients had to wait three days before transferring the foreign exchange to their FCDU.