BIZ BUZZ: Digital payment fee reforms up next

MANILA, Philippines — Wouldn’t it be great if you didn’t have to shell out extra money when using digital payments to settle your electricity, toll fee, water or other merchant fees?

This, according to Bangko Sentral ng Pilipinas (BSP) Deputy Governor Mamerto Tangonan, is next on the banking regulator’s digitalization push. Earlier, the order to rationalize fund transfer fees created a bandwagon of banks (led by Bank of the Philippine Islands) waiving Instapay fees.

Like what it has done with money transfer fees, the BSP does not intend to force banks to waive payment fees for services, utilities and/or goods.

All the BSP has to do is to standardize digital payment practices to enforce an often-overlooked rule.

There is already an existing rule that such fees should be shouldered by the merchants, utility or collecting firms, not the paying consumer, Tangonan pointed out.

“The rule says that it should be the merchant or the biller who will pay.” Tangonan told Biz Buzz. “Just follow their own rules.”

“So they need to make the billers or the merchants pay for it, not the consumer. Kasi ikaw na nga nagbabayad (You are already the one paying),” he added.

Recently, Land Bank of the Philippines started waiving fees on online payments to government agents. But what the BSP is envisioning is to relieve consumers and shift the burden to all merchants/billers. That extra P5, P10, P12 or P15 won’t have to disappear from your e-wallet or bank account.

So the payment platforms will still collect that fee, but get it from their billers.

And from the BSP’s perspective, it’s not too much to let the billers take that burden.

“Delivery of that service has a cost. But you know, it’s the same platform that you use for other things, like bills payment, merchant payment. So they can still  make money from those services … and then they cross-sell credit products,” Tangonan said.

“For them, what’s the alternative if they don’t have digital channels? They have to set up multiple offices to collect cash payments. Do they want that?”

That will be another big win for consumers. INQ