October 17, 2021 at 04:44 pm
Julito G. Rada
The Bangko Sentral ng Pilipinas said it considers as a positive development the decision of the Hong Kong-based company Lyka/Things I Like Co. Ltd. to apply for registration as an operator of payment system in the country.
Lyka is a social media platform that allows people to earn GEMs (gift cards in electronic mode) for posting, sharing or liking content on its app.
"The Bangko Sentral ng Pilipinas welcomes the reported decision of Lyka/Things I Like Company Ltd to apply for registration as an operator of payment system under Philippine Laws and regulations. As of date, the BSP has yet to receive the appropriate application-related documents from Lyka/TIL," the BSP said in a statement over the weekend.
"As regulator of the Philippine payment system, the central bank shall continue to promote policies that foster the welfare of consumers, merchants, banks, and other participants in the country’s payments ecosystem," it said.
Lyka has 10 million registered users in the country and is endorsed by almost all celebrities and social media influencers.
Lyka said last week it would immediately put up an office in the Philippines and register as an operator of payment system in compliance with the order of the BSP. It issued the statement after the BSP denied the request of third-party Digital Spring Marketing and Advertising Inc. to be registered as an OPS of Lyka.
"The management of Lyka respects the findings of the Bangko Sentral ng Pilipinas that the registration as operator of payment system should be accomplished by Lyka itself and not through a local third party, Digital Spring Marketing and Advertising Inc.," Lyka said.
"In line with this recent development, Lyka Global shall register as an OPS as directed by BSP and will immediately put up its own office in the country," Lyka said.
Lyka also said it would end its partnership with Digital Spring as "we take on the challenge of operating in the Philippines on our own."
It assured that all contracts entered into by Digital Spring would be transferred to the new company and all obligations and signed agreements would be honored.
Consistent with Lyka's growing roster of wholly-owned subsidiaries in the United States, South Korea, Malaysia and Indonesia, it said it would hire the "creme de la creme" of business operation and management to oversee its Philippine company.
Lyka said it commenced sourcing for a country head and the best support team for an internal Philippine arm.
"Lyka will continue to closely cooperate with BSP and other regulators in order to keep advancing the truly innovative Lyka Gems, the first cashless and seamless social media gift card in the world," it said.
It said the addition of an internal entity in a social media hub like the Philippines could only bring Lyka a step closer to its vision of becoming a global app conglomerate.
Earlier, the BSP upheld the cease-and-desist order issued against Digital Spring on July 23, 2021, reiterating that Lyka/Things I Like Company Ltd. Payment System and not Digital Spring should register as an operator of payment system with the BSP.
BSP Deputy Governor Mamerto Tangonan said Digital Spring applying for registration, instead of Lyka itself, was like saying the airline ticketing office could apply for a flying license on behalf of a pilot.
Lyka was launched in Southeast Asia in 2019, but was previously known as the Things I Like application before its apparent rebranding.
Tangonan said the BSP enables safe, convenient and cost-saving digital payments services to the public for their payment needs. In the process, BSP oversees payment system operators to protect consumers, merchants, banks, and other payment system participants.
For its continuous protection, the public is reminded to only use the payment services of a registered OPS. An OPS may be cash-in service providers, bills payment service providers and entities such as payment gateways and merchant acquirers that enable sellers of goods and services to accept payments, in cash or digital form.
The BSP reminded entities operating a payment system to comply with the requirements under the NPSA and BSP Circular No. 1049.
Circular No. 1049 provides for the rules and regulations on the registration of operators of payment system. 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.