Money Services Business Licensing in the Philippines: A Complete Guide for Fintech Companies

The Philippines has emerged as one of Southeast Asia's most dynamic fintech markets. With a population of over 110 million and significant unbanked segments, fintech companies see tremendous opportunity. However, operating a money services business requires proper licensing from the Bangko Sentral ng Pilipinas (BSP). This guide covers the regulatory framework under the M-Regulations (BSP Circular No. 1206) and provides a roadmap for obtaining the necessary licenses.

What is a Money Services Business (MSB)?

Note: MSB licensing is distinct from the Merchant Acquisition License (MAL), which is required for Operators of Payment Systems engaging in merchant onboarding and payment processing. If your business model involves helping merchants accept payments (like payment gateways), you need an MAL. If your business involves money transfers, e-wallets, cryptocurrency, or currency exchange, you need an MSB license as described below.

Under BSP regulations, a Money Services Business is defined as a non-banking entity engaged in one or more of the following activities:

Remittance services
Money changing
Foreign exchange dealings

The M-Regulations, which took effect in December 2024, consolidate all rules governing MSBs, repealing previous provisions in Sections 901-N and 902-N of the Manual of Regulations for Non-bank Financial Institutions (MORNBFI).

Types of Money Services Businesses

MSBs are classified into two main categories:

1. Remittance and Transfer Companies (RTCs)

RTCs include the following subcategories:

Remittance Agents (RAs): Companies that facilitate domestic and international money transfers
Remittance Platform Providers (RPPs): Technology platforms enabling remittance transactions
E-Money Issuers (EMIs): Companies that issue electronic money and operate e-wallets
Virtual Asset Service Providers (VASPs): Companies dealing in cryptocurrency and virtual assets

2. Money Changers (MCs) / Foreign Exchange Dealers (FXDs)

Entities engaged in buying and selling foreign currencies.

BSP License Classifications and Requirements

The BSP classifies MSBs into different types based on their operations, each with specific capital requirements, registration fees, and annual fees:

Type	Classification	Min. Capital	Reg. Fee	Annual Fee
A	Large-Scale Remittance Agent (monthly transactions ≥ PHP 75M)	PHP 50M	PHP 100,000	PHP 100,000
B	Small-Scale Remittance Agent (monthly transactions < PHP 75M)	< PHP 50M	PHP 20,000	PHP 20,000
C	E-Money Issuer (Large Scale)	PHP 200M	PHP 100,000	PHP 300,000+
C	E-Money Issuer (Small Scale)	PHP 100M	PHP 100,000	PHP 300,000+
D	Remittance Platform Provider	PHP 10M	PHP 100,000	PHP 100,000
E	Large-Scale Money Changer/FX Dealer (monthly transactions ≥ PHP 50M)	PHP 10M	PHP 100,000	PHP 100,000
F	Small-Scale Money Changer/FX Dealer (monthly transactions < PHP 50M)	< PHP 10M	PHP 20,000	PHP 20,000
-	VASP (Custodial)	PHP 50M	PHP 100,000	PHP 100,000
-	VASP (Non-custodial)	PHP 10M	PHP 20,000	PHP 20,000

E-Money Issuer (EMI) License

E-Money Issuers are authorized to convert cash into electronic money that can be stored in digital wallets. This is the license required for operating e-wallet services like GCash or Maya.

Key Requirements:

Minimum Capital: PHP 100 million (small scale) to PHP 200 million (large scale)
Liquidity Reserve: 1:1 ratio—EMIs must maintain reserves equal to all outstanding e-money liabilities
Segregated Funds: Customer funds must be separated from operational funds

Current Status:

The BSP lifted the moratorium on new EMI-NBFI applications in late 2024. New applicants may now apply for EMI licenses, though the approval process remains rigorous.

Virtual Asset Service Provider (VASP) License

VASPs are companies involved in cryptocurrency and virtual asset transactions, including:

Exchange between virtual assets and fiat currencies
Exchange between one or more forms of virtual assets
Transfer of virtual assets
Safekeeping and administration of virtual assets (custodial services)

Capital Requirements:

Custodial VASP: PHP 50 million minimum
Non-custodial VASP: PHP 10 million minimum

Important Notice - VASP Moratorium:

The BSP continues to maintain a moratorium on new VASP licenses until September 2025. However, existing BSP-supervised financial institutions may still apply to expand their operations to include VASP services.

Registration Process Overview

The BSP registration process consists of three stages:

Stage 1: Preliminary Assessment (20 working days for RTCs/MCs/FXDs; 13 working days for VASPs)

Required documents include:

Letter of Application signed by authorized officer
Proof of SEC/DTI registration
Comprehensive Business Plan
List of owners, directors, and key officers
Compliance with fitness and propriety requirements (personal data forms, NBI clearance)
Proof of financial capacity
Certification that funds are not from unlawful activities
Proof of AML training attendance
Provisional AMLC registration
Non-refundable filing fee payment

Stage 2: SEC Registration (7 working days)

After Stage 1 approval, you must:

Obtain BSP Letter of No Objection
Register your Articles of Incorporation with the SEC indicating MSB purpose

Stage 3: Certificate of Authority Issuance (13-20 working days)

Final requirements include:

Notarized Application for Authority to Establish and Operate
Certified true copy of registered AOI/By-laws
Business license from local government
Notarized Deed of Undertaking
Updated proof of financial capacity
Payment of licensing and metal plate fees

Total processing time: Approximately 40-47 working days for standard MSBs; longer for VASPs due to additional verification requirements.

AMLC Registration Requirement

All MSBs are classified as "covered persons" under the Anti-Money Laundering Act. Before commencing operations, you must:

Register with the Anti-Money Laundering Council (AMLC)
Obtain the AMLC Certificate of Registration
Implement KYC (Know Your Customer) procedures
File Suspicious Transaction Reports (STRs) as required
Comply with the Philippine Travel Rule for cross-border transactions

Multiple Licenses: When You Need More Than One

An entity receives only the specific MSB license for which it applies. If your business model involves multiple money services activities, you need separate licenses for each.

Example: A fintech app that allows users to:

Buy and sell cryptocurrency
Hold e-money in an e-wallet
Send money domestically and overseas
Exchange foreign currencies

This company would need VASP, EMI, RA, and MC/FX licenses respectively.

Reference: Licenses Held by Major Philippine Fintech Companies

Major fintech players in the Philippines typically hold multiple licenses:

E-wallet providers often combine EMI and RA licenses
Crypto exchanges may hold VASP, EMI, and Operator of Payment System (OPS) licenses
Comprehensive fintech platforms may hold 4-5 different BSP licenses

Electronic Payment and Financial Services (EPFS) License

In addition to the basic MSB license, companies may apply for an advanced EPFS license. This license authorizes end-users to initiate and receive payments or access financial information through electronic devices, enabling more sophisticated financial services.

Compliance Obligations

Once licensed, MSBs must maintain ongoing compliance with:

Capital adequacy: Maintain minimum capital requirements at all times
Liquidity requirements: EMIs must maintain 1:1 reserves
AML/CFT compliance: Continuous monitoring and reporting obligations
Consumer protection: Clear disclosure of fees, complaint handling mechanisms
IT risk management: Per BSP Circular No. 1213 (May 2025) for advanced electronic payment services
Annual renewal: Payment of annual service fees
Reportorial requirements: Regular submissions to BSP

Foreign Companies: Entry Requirements

Foreign fintech companies seeking to enter the Philippine market must:

Establish a branch or subsidiary through SEC registration
Meet secondary licensing requirements with SEC and/or BSP
Comply with local AML requirements
Satisfy minimum capital requirements (foreign investment rules may apply)

Timeline and Commencement of Operations

Upon successful registration, BSP issues a Certificate of Registration (COR). Important note: Operations must commence within three (3) months of COR issuance, or the certificate will be cancelled.

Key Takeaways

Define your scope clearly: Different activities require different licenses. Map out your intended services before applying.
Plan for significant capital: Minimum capital requirements range from PHP 10 million to PHP 200 million depending on license type.
Budget for ongoing fees: Annual service fees and compliance costs are substantial.
Start with AML compliance: AMLC registration and AML training are prerequisites for BSP application.
Allow adequate time: The full licensing process typically takes 3-6 months minimum.
Consider current moratoria: VASP moratorium remains in effect until September 2025.

The Philippine fintech regulatory landscape continues to evolve as the BSP balances innovation with financial stability and consumer protection. Companies entering this space should engage experienced legal counsel to navigate the regulatory requirements and ensure successful licensing.