BSP Circular 1140: What it means for Filipino BFSIs and businesses
08 August 2022
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Digital transactions are expected to grow in the Philippines, as a continued trend from during the Covid pandemic. Plus, with the government's target to have 70% of the adult population holding bank or eMoney accounts by 2023, online commerce and digital banking are encouraged, and the preference for digital payments is gaining momentum. Yet, at the same time, fraud and fraudulent activities aren't just on the rise – they are quickly evolving too.


To protect consumers and businesses, the Bangko Sentral ng Pilipinas (BSP) released Circular No. 1140 in March 2022. Its objectives are to help strengthen the Philippines' stance against cybercrime, providing banks and financial service institutions (BFSIs) with a framework that not only protects consumers from fraudulent schemes, but also enhances consumers' and businesses' confidence in utilising digital channels.


BSP Circular 1140's requirements


By December 31, 2022, BFSIs in the Philippines are to implement automated and real-time fraud monitoring to prevent and minimise losses arising from fraud and cybercriminal activities. The fraud monitoring system(s) must be able to constantly calibrate to process surges in transactions, analyse customer profiles and behaviors – and detect new fraud patterns.

 BSP 1140 requirements


Also, as customer journeys become more and more seamless, fraud monitoring also needs to be across all channels including at kiosks, point-of-sale (POS), mobile point-of-sale (mPOS), in-app, websites, etc. As a reinforced line of defence, fraud management and anti-money laundering (AML) systems will need to be integrated too.


How ADVANCE.AI can help



ADVANCE.AI is already in discussion with several BFSIs and government agencies in the Philippines on how to effectively nip digital fraud in the bud. Besides being able to offer automated and real-time fraud protection, ADVANCE.AI Fraud Wall® leverages patented AI analysis that detects fraud in in real-time.


While risk scoring typically uses primary identifiers such as email addresses, Fraud Wall® AI risk scores target behavioral patterns even if the primary identifier has not been seen before – helping BFSIs and businesses effectively guard against evolving fraud. Curious about ADVANCE.AI Fraud Wall®? Contact us for a free demo session to learn more.


As part of ADVANCE.AI's Fraud Wall® , our Merchant Risk Intelligence (MRI) engine is also built to automate the tasks typically done by fraud analysts such as monitoring sales patterns and overall risk scores, to provide BFSIs and businesses with a fraud strategy that isn't just fast and smart but efficient too.


Online transactions aren't just happening on websites or mobile apps, which is ADVANCE.AI's complete fraud prevention solution is across all channels including e-commerce, POS, mPOS, QR codes and even ATMs. This omnichannel approach, combined with our comprehensive AML verification, helps BFSIs follow the guidelines in BSP Circular 1140 and keep fraud at bay from the point of onboarding.


From September 1, 2022, BFSIs need to be able to show their plans of actions that comply with the circular in preparation for the December 31, 2022, deadline. As part of its enforcement action, BSP may impose corrective actions and/or sanctions to improve a BFSI's risk management system or limit or suspend business activity that could adversely impact the BFSI.


We suggest contacting our team to discuss any solution gap or find a fraud prevention and detection solution that best works for your organisation.


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