Medalla confident in reaching agreement with banks on zero fees for small transactions

Bangko Sentral ng Pilipinas (BSP) Governor Felipe M. Medalla expressed confidence that an agreement will soon be reached with banks and payment operators regarding the elimination of fees on small transactions of P500 and below.

While the agreement has not been finalized yet, Medalla is optimistic about the progress being made.

Medalla acknowledged that charging fees on small transactions is seen as prohibitive, but the challenge lies in determining the specifics of waiving these fees.

The complexity arises from deciding whether the privilege of zero fees should extend to large supermarkets and the involvement of a process for such establishments. This has contributed to the delay in reaching a final agreement on waiving charges for small bank-to-bank payment transactions.

To be entitled to zero fees, there may be a requirement for small units or merchants to register, but the concern is that some small merchants may not want to undergo the registration process at all.

Medalla proposed treating every person-to-person transaction as a merchant and letting the operating system determine the actual merchant as the data evolves.

He said discussions with bankers have been productive, and they are keen on making it work.

While waiving fees for transactions of P500 or less is manageable for banks, they want clarity on cost recovery and the availability of alternative revenue sources.