BSP Tightens Merchant Oversight to Disrupt Illicit Online Casino Payment Flows

The Bangko Sentral ng Pilipinas is preparing stricter controls for payment service providers after identifying thousands of merchant accounts tied to illegal online casino transactions. Surveillance uncovered businesses that presented as ordinary merchants but handled large volumes of small payments late at night, many directed toward online wagers. Beauty salons, bakeries and neighborhood stores numbered among the fronts used.

More than 8,000 merchant accounts have been closed. Individual transactions dipped as low as PHP50 (about $0.80). According to Bloomberg, authorities linked the patterns directly to unregistered casino betting.

Mamerto Tangonan, BSP Deputy Governor, stated that providers must perform stronger checks on platform users. “We want to protect consumers from online fraud, illegal activities and also from money launderers,” Tangonan said. “You cannot expand digitalization if people’s money is being stolen or they’re being scammed.”

Alejandro Tengco, Chairman and CEO of the Philippine Amusement and Gaming Corp. (PAGCOR), confirmed that some ordinary-named businesses function as unregistered operators. “Unfortunately, we don’t have control over that,” Tengco said. PAGCOR is collaborating with the BSP and plans to launch an app for identifying legitimate sites before the end of 2026.

Proposed Changes to Payment-System Rules

A BSP draft document requires providers to gather additional merchant data, including ownership details and licenses. Providers must maintain databases of legitimate merchants and face limits on arrangements that obscure the actual beneficiary or settlement account. Casino and online wagering businesses must adopt direct merchant setups coupled with enhanced due diligence. Repeated compliance failures could place a provider’s payment license at risk.

Tangonan was clear on accountability: “If there are illegal activities and you’re not able to stop it, then you are accountable.” The proposal builds on 2025 orders that forced e-wallet providers to cut direct links to licensed gaming operators. PAGCOR now places the licensed share of Philippine online gambling at about 50%, against earlier industry estimates as high as 75%.

Balancing Controls Against Digital Payments Growth

Payment companies including Maya, GCash and the EMoney Association of the Philippines have expressed support for the tighter safeguards, citing their existing onboarding and monitoring procedures. Electronic payments accounted for approximately two-thirds of retail transactions in 2025, up from 57% in 2024 and 10% in 2018.

Tangonan acknowledged that stronger merchant checks may temporarily slow the pace of digital-payment expansion. He maintained there is no trade-off: “You shouldn’t sacrifice safety for growth. There’s no trade-off there.” The measures underscore the concrete limits that arise when illicit flows exploit layered intermediaries, forcing providers to choose between speed and traceability if they wish to retain operating authority.

Reporting: World Casino News

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