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HomeBusinessBSP RECALIBRATES APPROACH IN LICENSING VIRTUAL ASSET SERVICE PROVIDERS (VASPs)

BSP RECALIBRATES APPROACH IN LICENSING VIRTUAL ASSET SERVICE PROVIDERS (VASPs)

The Monetary Board approved a modified approach to the grant of Virtual Asset Service Provider (VASP) license consistent with the thrust of the Bangko Sentral to maintain the integrity and stability of the financial system and strengthen consumer confidence in the digital ecosystem.

The modified approach involved the closure of the regular application window for new VASP licenses for a period of three (3) years and grant of new VASP licenses only to existing BSP supervised financial institutions (BSFIs).

Bangko Sentral Governor Felipe M. Medalla highlighted that, “Recent market developments have necessitated the adoption of a modified VASP licensing approach, which strategically shifts the focus to assessing the existing Bangko Sentral-registered VASPs’ overall performance and risk management systems, their impact on financial services and financial inclusion agenda, and their contribution towards the achievement of the Digital Payments Transformation Roadmap (DPTR) objectives.”

Under the modified approach, existing BSFIs with strong risk management systems including appropriate client suitability assessment and customer onboarding practices, and intensified financial consumer education and awareness programs may still apply for a VASP license.

Meanwhile, applications received by the Bangko Sentral from non-BSFIs that have completed/passed Stage 2 of the licensing process on or before 31 August 2022 will be processed and assessed for completeness and sufficiency of documentation/information based on Stage 3 requirements. Applications with incomplete requirements as of 31 August 2022 will be returned and considered closed. The Bangko Sentral will no longer entertain nor accept new applications beginning 01 September 2022.

The Bangko Sentral will continue to intensify its surveillance of the developments in the digital space, enhance existing monitoring capabilities over the digital threat landscape, and expand consumer awareness campaigns on the risks of holding virtual assets. Governor Medalla assured that, “The Bangko Sentral remains supportive and proactive in responding to the developments in the digital financial ecosystem.”

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