Insider Spotlight
The new rule
In Circular No. 1218, issued Sept. 18, BSP said transactions beyond the P500,000 daily cap—or its equivalent in foreign currency—must be done through traceable channels such as checks, electronic fund transfers, direct credits, or digital payments. The ceiling applies whether reached in one transaction or several within the same banking day.
Withdrawal exceptions
For legitimate needs to withdraw more than P500,000 in cash, clients must undergo enhanced due diligence (EDD). This involves stricter identity checks and documentary proof of a legitimate business purpose. Banks may also require additional records before releasing the funds.
If warranted, financial institutions must file a suspicious transaction report with regulators. The BSP stressed that EDD should only allow payouts when justified by credible documentation.
Bank discretion
The central bank also gave BSP-supervised financial institutions the discretion to impose stricter internal caps on cash transactions. These limits may be lower than P500,000, depending on the institution’s risk assessment and the financial profile of the client.
Why it matters
The measure seeks to reduce the risks of money laundering and other illicit activities involving large cash movements. By pushing transactions into traceable channels, regulators aim to strengthen confidence in the financial system and improve oversight.
The bigger picture
The BSP said the regulation is part of a broader effort to adapt to emerging risks in financial crime. The move is expected to push both individuals and businesses toward electronic channels, in line with the central bank’s digital payments agenda.
