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BSP Orders Lyka to Stop Operating, Invites Registration

The BSP ordered Lyka, creator of Lyka Gems, to cease operating its payment systems until it registers and receives the required licenses from the BSP.

Photo for the Article - BSP Orders Lyka to Stop Operating, Invites Registration

By Michael Lance

The Bangko Sentral ng Pilipinas (BSP) orders Lyka, a popular social platform, to suspend payment operations and invites it to register with the central bank as prescribed under Republic Act 11127 or the National Payment Systems Act (NPSA).

The act defines an operator as “any person who provides clearing or settlement services in a payment system, or defines, prescribes, designs, controls or maintains the operational framework for the system.”

Lyka, a social media platform launched in the Philippines by a Hong Kong-based company, allows its users to purchase, exchange, and use Gift cards in Electronic Mode or GEMs as payment for goods and services.

The Monetary Board said these activities qualify Lyka as an OPS, therefore it is required to register with the BSP before continuing with its payment system operation.

“The operators of Lyka have already expressed their willingness to register as an OPS,” Governor Benjamin Diokno said in a virtual press briefing.

The BSP reminds entities operating a payment system to comply with the requirement under the NPSA and BSP Circular No. 1049 to register with the BSP. Registration of an OPS allows the BSP to have oversight of the payment system it operates to ensure that it functions safely, efficiently, and reliably by itself, consistent with the central bank’s objectives of consumer protection and financial stability.

Under Circular No. 1049, OPS that are required to register, but are found to be operating without registration, shall be directed to comply with the Circular’s registration requirements. Those that fail to comply may be ordered to stop operations until immediate action is taken to register with the BSP.

This article is published on BitPinas: BSP Orders Lyka to Stop Operating, Invites Registration

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