Free is fine. But free-with-conditions is not really free.
RCBC capped free InstaPay transfers at 30 per month with P10 charges beyond that limit, drawing BSP criticism for non-compliance with new pricing rules. BSP circular requires that inter-bank transfer fees match intra-bank fees plus only the switch fee (~P1.50), making RCBC's conditional offer structurally problematic.
- RCBC capped free InstaPay transfers at 30 per month, charging P10 beyond that limit
- BSP Circular No. 1238 requires inter-bank fees to match intra-bank fees plus only the P1.50 switch fee
- BPI chose to eliminate all transfer fees rather than defend a conditional model
- BSP Deputy Governor Tangonan said RCBC's structure is non-compliant and hinted at enforcement action
RCBC's limited free InstaPay transfers with a 30-transaction monthly cap fail to meet BSP's new circular requirements, prompting regulatory pushback on the bank's fee structure compliance.
On Friday, July 3rd, RCBC announced it was joining the wave of banks moving to eliminate digital transfer fees. Starting the next day, customers using RCBC Pulz and DiskarTech—the bank's two main mobile apps—would be able to send money via InstaPay without paying a fee. It sounded like good news. The Bangko Sentral ng Pilipinas had just issued new rules designed to bring down the cost of moving money between banks, and RCBC appeared to be complying. But the central bank's deputy governor had a different read.
The catch was in the fine print. RCBC Pulz users could make 30 free InstaPay transfers per month, each for a minimum of P100. Anything beyond that—or anything below the minimum—would still cost P10. DiskarTech users, the bank's financial inclusion product aimed at underbanked Filipinos, would get truly unlimited free transfers with no floor on transaction size. It was a split approach: generosity for one segment, conditions for another.
BSP Deputy Governor Mamerto Tangonan told reporters that the central bank had already raised the issue directly with RCBC president Reggie Cariaso. "We talked to Reggie," Tangonan said. "We said that's not compliant with the circular." The circular in question—BSP Circular No. 1238, effective July 4—sets out a new pricing framework for all digital fund transfers. The logic is straightforward: if a bank charges nothing to move money between its own customers, it cannot charge much more to move money to another bank's customers. The only legitimate fee is the switch fee, the industry-wide cost of routing the transaction through the payment system, which runs about P1.50 for InstaPay.
RCBC's 30-transfer cap creates a structural problem under this framework. Once a customer exhausts the monthly allowance, they face a P10 charge for the same service that was free moments before. The BSP's concern is whether that P10 can be justified when the actual cost to route the transaction is only P1.50 plus whatever it costs RCBC to process it internally—which, if intra-bank transfers are free, should be minimal. Tangonan explained the math plainly: "Bank A to Bank A, free. And then, if you want to maintain that free Bank A to Bank A, free, when you do Bank A to Bank B, it should be [just] plus switch." The circular doesn't forbid charging; it forbids the gap between what you charge your own customers and what you charge everyone else.
There was another wrinkle. RCBC had announced free InstaPay transfers but said nothing about PESONet, the other major payment rail for person-to-person transfers. Tangonan stressed that the BSP's new rules apply to all person-to-person transfers, not just one system. The circular's reach is broader than RCBC's announcement suggested.
Bank of the Philippine Islands had faced the same pricing math and chosen a simpler path. BPI's intra-bank transfers were already free, so under the new circular, charging P1.50 for transfers to other banks would be technically compliant but practically awkward. BPI president TG Limcaoco decided the fee wasn't worth the customer friction. "We said, why would we still charge P1.50? You're just needling the customer," he said. "But P1.50, will it make a big difference for us now? No." BPI went all-in on free transfers across all rails, framing it as good for financial inclusion.
Tangonan left RCBC with an implicit ultimatum. The BSP's enforcement approach starts with a friendly reminder, he said, then moves to "another reminder, less friendly." When asked if he had already told RCBC to change its mechanism, he offered only: "Just wait for tomorrow." The timing compounds RCBC's pressure. Moody's had recently revised the bank's credit outlook to negative, citing concerns about deteriorating asset quality. RCBC's leadership had responded by emphasizing "deliberate strength" and balance-sheet protection, but now the bank faces regulatory pressure on a consumer-facing product launched precisely to show compliance with new rules.
The question now is whether RCBC will align with BPI's model or attempt to defend its conditional offer. The BSP has made clear which direction it prefers, and the enforcement ladder is ready to climb.
Notable Quotes
We talked to Reggie. We said that's not compliant with the circular.— BSP Deputy Governor Mamerto Tangonan, on RCBC's fee structure
Why would we still charge P1.50? You're just needling the customer. But P1.50, will it make a big difference for us now? No.— BPI president TG Limcaoco, explaining why BPI chose all-free transfers
The Hearth Conversation Another angle on the story
Why does the BSP care so much about a 30-transfer cap? Isn't RCBC still making transfers free?
Because the cap creates a two-tier system. Once you hit 30, you pay P10. The BSP's rule says you can't charge more to other banks than you charge your own customers, plus a tiny switch fee. A P10 fee after the cap blows past that logic.
So the BSP is saying the cap itself is the problem, not the free part?
Exactly. Free is fine. But free-with-conditions is a way of saying "not really free." The circular is trying to eliminate the gap between intra-bank and inter-bank fees. RCBC's structure preserves that gap, just delayed.
Why did RCBC do it this way instead of just making everything free like BPI?
Probably cost control. A 30-cap limits their exposure. But the BSP sees it as regulatory arbitrage—technically compliant on the surface, but structurally evasive.
What happens if RCBC doesn't change?
Tangonan said there's a ladder: friendly reminder, then less friendly reminder. He hinted something would happen by the next day. It's pressure, but not yet enforcement.
Does this affect the DiskarTech customers differently?
DiskarTech gets truly unlimited free transfers. That's compliant. So RCBC is treating its poorest customers better than its mainstream app users—which is ironic given the whole point of the circular is financial inclusion.
What's the real cost to RCBC of going all-free?
That's the question nobody's asking publicly. BPI decided P1.50 wasn't worth the irritation. RCBC apparently thinks it is. But now they're facing regulatory heat, which costs something too.