The community voiced concerns and shared mixed reactions after the Bangko Sentral ng Pilipinas (BSP) said in a media interview that it is studying the possibility of replacing per-transaction fees with a subscription-based model for digital payment platforms.
What’s the significance: The proposal, if implemented, could directly impact how consumers and businesses engage with digital payments.
Key details:
- On January 10, the central bank stated that it is exploring subscription-based fees for digital payments to reduce costs, promote financial inclusion, and support a cash-lite economy.
- BSP Governor Eli Remolona Jr. said the current fee-based model as ineffective.
- Accordingly, the community responds through comments on BitPinas’ posts, arguing it favors profit over fairness and convenience, especially for low-income and infrequent users.
A community member rejected the idea of a subscription-based model, arguing that a pay-per-transfer fee system is more practical as it charges users solely for completed transactions, avoiding unnecessary costs when no transfers occur:
“I think a fee per transfer would be a more logical reason instead of subscription. Pay per use not pay when you don’t use. Why make people pay when they did not do any transaction. Think about it. Why pay subscription if you only use it, say just a few times or none at all. It should depend more on one’s usage. Money transfers from all over the world only charge fees for every transfer. NO (to) the subscription crap, for the benefit of the Filipino peeps.”
Another highlighted that the BSP’s one-size-fits-all subscription fee might unfairly burden infrequent users by having them subsidize heavy users, ultimately solving one issue while creating new problems.
- A commenter also pointed out that a monthly subscription fee benefits companies by ensuring consistent revenue, unlike fluctuating transaction fees.
- Moreover, another user noted that the monthly subscription model would only be cost-effective for consumers making over ten transactions a month, typically business entities.
“It depends on how much that monthly subscription will cost. If it’s more than the per transaction cost then it will be useless. But in reality, they just want to show they exist, but still useless. Make it simple, lower the per transaction cost.”
Current Fees
Between the lines: While the BSP’s intention is to reduce costs and improve access, the proposed subscription model may inadvertently widen the gap between heavy users and occasional users, challenging its goal of promoting financial inclusion.
Worth reading: In 2023, it can be remembered that then-BSP Governor Felipe Medalla stated that they are exploring the elimination of transaction fees for small-value fund transfers, proposing a cost-sharing system with banks and payment operators to encourage digital payments and ensure financial inclusivity.
This article is published on BitPinas: Mixed Reactions Surface as BSP Studies Subscription Fee Model for Digital Payments
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