The Monetary Board, the policy-making body of the Bangko Sentral ng Pilipinas, said Thursday it amended the foreign exchange rules to ease access to foreign exchange for trade and non-trade current account transactions and support digital payment transactions.
It said in a statement it approved further amendments to FX regulations to promote greater ease in the use of FX resources of the banking system and further streamline or simplify procedures and documentary requirements for FX transactions.
“The FX reforms also intend to facilitate digital payments/electronic transactions, support the infrastructure development projects/programs of the national government, and help further deepen the domestic capital market,” it said.
The major FX reforms include allowing the sale of foreign exchange by banks without prior BSP approval for the following FX transactions involving: e-commerce market participants to support digital payments/electronic transactions; offsetting of payables with receivables between/among residents for various FX transactions, and residents with non-residents for their trade and non-trade current account transactions.
Such FX transactions also include living allowance/medical expenses of dependents abroad, among other non-trade current account transactions; importation of goods with services covered by engineering, procurement and construction contracts; and payment of fees prior to registration provided that the foreign loans are duly reported to the BSP.
Also included are FX derivatives transactions to be entered into by non-bank government entities without prior BSP approval; and use of peso receipts relating to trade transactions to fund peso deposit accounts of non-residents, among others.
“These reforms are part of the BSP’s commitment to maintain an FX regulatory framework that is responsive to the needs of a dynamic and expanding Philippine economy,” the MB said.
The BSP said banks were expected to continue to implement safe and sound practices amid the continuing liberalization of FX rules.
The implementing circular will take effect 15 banking days after its publication.