FOR over three decades, the Bangko Sentral ng Pilipinas (BSP) has worked to protect the economy by upholding the fundamentals of central banking: stable prices, a sound financial system, and safe and efficient payments.
In 2025, the BSP pursued bold reforms that strengthened these fundamentals — laying the groundwork for a more resilient and sustainable future for Filipinos.
Keeping prices stable to protect the future
The BSP’s primary mandate is price stability. Keeping prices from rising — or falling — significantly helps protect purchasing power and supports better financial decision-making. When inflation is kept in check, households can manage budgets more effectively, save money with greater confidence and plan better. Businesses, in turn, are better able to invest, expand and create jobs.
In 2025, the BSP carefully adjusted its monetary policy in response to inflation trends and expectations. The target reverse repurchase (RRP) rate was reduced to 4.50 percent. By year-end, interest rates on overnight deposit and lending facilities were also lowered to 4.00 percent and 5.00 percent, respectively. This timely easing helped stimulate business activity and consumer confidence without compromising inflation management.
Inflation remained benign in early 2026 before rising in March due primarily to global oil supply disruptions linked to geopolitical tensions in the Middle East. In response, the BSP implemented a preemptive 25-basis-point policy rate increase in April and another 25-basis-point increase in June, bringing the reverse repurchase (RRP) rate to 4.75 percent. The move was meant to anchor inflation expectations and prevent potential second-round effects, or subsequent increases in wages, prices and inflation expectations following an initial price shock, in this case the spike in global oil prices due to the Middle East conflict.
The BSP also actively managed liquidity in the financial system to ensure that market conditions remained aligned with policy goals. As of December 2025, outstanding liquidity placements reached P1.5 trillion, with a greater share shifting to short-term, overnight instruments. Banks used BSP facilities to support lending, meet withdrawals, manage deposit movements and comply with reserve requirements.
Price stability is further supported by a stable external environment. The BSP facilitated private sector foreign borrowings and prudently managed the country’s gross international reserves (GIR). As of end-April 2026, the country’s GIR reached $104 billion, equivalent to almost seven months of import cover and nearly four times short-term external debt.
Strengthening the financial system against tomorrow’s risks
Price stability is only one part of the strong foundations that the BSP continues to build as it turns 33 years old. A financial system that people can trust — one that remains resilient in the face of shocks, emerging risks and rapid technological change — is another.Philippine banks continued to grow in 2025. Total banking assets expanded to nearly P30 trillion, driven by healthy growth in loans and investments. This steady expansion reflected sustained confidence in the system and the banks’ continued ability to support households, businesses and key industries. Bank credit also grew at double-digit rates in 2025, widening access to financing for households and productive sectors. Loans flow to real estate, manufacturing, trade, utilities and families — sectors that drive jobs, commerce and everyday economic activity. This expansion directly supported financial inclusion, giving more Filipinos the ability to save, invest, build homes and grow enterprises. BSP-supervised non-bank financial institutions — from electronic money issuers and payment service providers to pawnshops and remittance firms — played an increasingly important role in widening access to finance. Digital payments and alternative credit channels helped reach underserved communities, providing lower-cost and more convenient services.
Another major milestone in 2025 reinforced confidence in the Philippine financial system: the country’s successful exit from the Financial Action Task Force (FATF) grey list, followed by its removal from high-risk jurisdiction lists in Europe. This achievement reflected years of reforms to strengthen anti-money laundering and counter-terrorism financing frameworks.
New rules on large-value cash transactions, stronger governance standards and enhanced reporting requirements further reinforced financial integrity and transparency.
As everyday transactions became increasingly digital, the BSP moved decisively to strengthen cyber resilience and consumer protection. In 2025, it established a Financial Cyber Resilience Governance Council to guide sector-wide efforts against online threats.
New regulations under the Anti-Financial Account Scamming Act also required financial institutions to adopt advanced fraud-monitoring tools and introduce rapid “kill-switch” mechanisms to protect customers from scams.
After 33 years, the BSP’s mission to help maintain financial system stability remains unchanged — but its tools are sharper, its outlook broader and its commitment stronger than ever. In safeguarding stability, enabling innovation and expanding access, the BSP continues to build a financial system that not only stands firm — but moves the country forward.
Powering a future-ready payments and settlement system
A modern economy also depends on a payments system that works — one that supports financial transactions that are fast, secure and reliable.
In 2025, digital payments continued to expand, supported by the quick response (QR) code-based payment ecosystem, particularly QR Ph person-to-merchant (P2M) and InstaPay QR person-to-person (P2P) payments. QR Ph P2M posted 2.5 billion transactions amounting to P1.2 trillion, reflecting broader merchant acceptance and rising consumer preference for more convenient retail payments. Likewise, InstaPay QR contributed to this momentum with 183.3 million transactions valued at P926.1 billion.
Meanwhile, PESONet facilitated 117.2 million transactions worth P13.2 trillion, supporting higher-value transfers such as corporate, payroll and bulk payments.
Behind these channels, resilience remained a priority. The Peso Real-Time Gross Settlement Payment System, or PhilPaSSplus, delivered consistently high efficiency, ensuring the timely settlement of large-value interbank transactions and retail payment clearing results.
Looking ahead, the BSP advanced initiatives to prepare the Philippines for an increasingly connected payments landscape. The adoption of ISO 20022 messaging standards strengthened data quality and transparency, laying the groundwork for more efficient, interoperable and future-ready payment systems.