Senator Joel Villanueva proposed a bill would require banks and other financial institutions to provide mandatory relief to borrowers, depositors, and digital payment users during national emergencies.

This measure seeks to grant the Bangko Sentral ng Pilipinas stronger enforcement powers to manage such crises effectively.

Villanueva, who chairs the Senate Committee on Banks, filed Senate Bill No. 2121 or the “Emergency Financial Stability and Consumer Protection Act,” which seeks to shift the BSP’s crisis response authority from voluntary compliance to enforceable action.

The senator said the proposal addresses gaps exposed during recent emergencies, including the COVID-19 pandemic and the recent State of National Energy Emergency, when the BSP could only encourage — but not compel — financial institutions to extend assistance to consumers.

"The BSP's job is to keep the financial system stable and protect the Filipino public, especially during a crisis. But we cannot ask the BSP to do its job and then leave it without the tools to do so," Villanueva said in a statement. "This bill gives the BSP the authority it needs to act and to enforce."

Under the proposed measure, once a national emergency is declared and the BSP Monetary Board determines that extraordinary intervention is needed, the central bank may issue binding directives to BSP-supervised institutions, including banks, quasi-banks, electronic money issuers, and payment system operators.

These directives may include mandatory grace periods, payment deferrals, loan restructuring programs, and other consumer relief measures.

The BSP would also be authorized to suspend or waive fees for digital payment channels such as InstaPay and PESONet, and impose temporary transaction limits if needed to preserve financial stability.

The bill requires the BSP to ensure that emergency interventions are reasonable, targeted, and limited in duration, while considering the impact on both consumers and the financial sector.

"Voluntary compliance is not good enough when Filipinos are struggling to keep the lights on, pay their loans, and put food on the table," Villanueva said. "The public deserves a guarantee, not a request."

To prevent abuse, the proposal states that no BSP directive may remain in force beyond 180 days after the end of a declared emergency unless extended by law.

Any measures imposed must also remain temporary, proportionate, and strictly necessary to address the crisis.

Financial institutions that comply in good faith would be protected from civil, administrative, or criminal liability, except in cases involving fraud, gross negligence, or willful misconduct. Institutions that fail to comply could face sanctions under existing banking laws, including fines, cease-and-desist orders, and suspension of responsible officers.

The measure also requires the BSP to submit a report to Congress within 60 days after every emergency, detailing the actions taken, their economic impact, enforcement measures imposed, and recommendations to improve future crisis preparedness.

"When the next crisis comes—and it will come—the BSP should not have to beg. It should be ready to act, and Filipinos should know that relief from their bank is on the way," Villanueva said.

-Paraluman News