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The Bangko Sentral ng Pilipinas (BSP) is enforcing a new cash withdrawal cap of P500,000 per day as part of efforts to mitigate money laundering threats related to substantial cash dealings.<\/p>\n
BSP Governor Eli Remolona Jr. published on Thursday Circular No. 1218 instructing all supervised financial institutions (BSFI) to execute \u201cenhanced due diligence (EDD) on high-value cash-related payments and transactions.\u201d<\/p>\n
According to the circular, a limit of P500,000 or its equivalent in foreign currency can be withdrawn in a single transaction or through multiple transactions within one banking day.<\/p>\n
The BSP stated that transactions surpassing the limit may only be executed via check payment, fund transfer, direct credit to deposit accounts, or the BSFI\u2019s digital payment systems.<\/p>\n
\u201cIn its recent sectoral risk evaluation and surveillance monitoring, the BSP has observed money laundering, terror financing, and proliferation financing risks emerging from cash transactions of banks and other BSP-supervised financial firms,\u201d the circular stated. \u201cThese investigations have highlighted the exploitation of cash-based transactions to move illicit funds into and out of the financial ecosystem.\u201d<\/p>\n
The BSP released this circular amid an ongoing inquiry into allegedly irregular flood control initiatives involving government personnel, contractors, and other entities.<\/p>\n
\u201cWith this adjustment, the BSP aims to bolster efforts against the use of cash for unlawful activities, enhance confidence in the financial system, and guarantee that it can adapt to emerging risks,\u201d the central bank stated.<\/p>\n
Nonetheless, the central bank noted that BSFIs may still permit withdrawals exceeding the P500,000 limit if the client provides documentation of a legitimate business intent. Such transactions may receive approval following the BSFI’s enhanced due diligence and the submission of a suspicious transaction report (STR).<\/p>\n
\u201cIf the BSFI is unable to satisfactorily fulfill the EDD procedures or has reasonable grounds to believe that executing the EDD process will alert the customer, it must file a suspicious transaction report and closely observe the account while reviewing the business relationship,\u201d the circular elaborated.<\/p>\n
\u201cThe BSFI is also urged to take into account the alerts, red flags, and suspicious indicators, alongside typologies noted\/reported by relevant government authorities, concerning large or atypical cash transactions when filing STR,\u201d it added.<\/p>\n
The circular will become effective 15 calendar days following its publication in the Official Gazette or in a widely circulated newspaper.<\/p>\n