BSP Elevates Cash Withdrawal Due Diligence Threshold to P1 Million
The Bangko Sentral ng Pilipinas (BSP) has announced a significant adjustment to its financial regulations, raising the cash withdrawal threshold that triggers enhanced due diligence (EDD) to P1 million from the previous P500,000. This move, detailed in Circular 1230 issued on February 27, 2026, aims to refine the focus on higher-risk activities while facilitating smoother legitimate and recurring transactions.
Rationale Behind the Increase
In a statement released on Tuesday, March 3, 2026, the BSP explained that the decision followed extensive consultations with banks and various industries. These discussions revealed a substantial volume of legitimate cash transactions exceeding the original threshold, including payroll disbursements, loan payouts, and project-based financial activities. By increasing the limit, the central bank seeks to reduce unnecessary administrative burdens for such routine operations.
Additionally, the adjustment aligns with findings from the latest anti-money laundering National Risk Assessment and ongoing surveillance monitoring. The BSP emphasized that robust risk-based safeguards remain crucial for protecting the integrity of the financial system, ensuring that the new threshold does not compromise security measures.
Implementation Details
Under the revised circular, depositors can now withdraw up to P1 million without undergoing enhanced due diligence procedures. However, transactions exceeding this amount will require proof of legitimacy to proceed. It is important to note that BSP-supervised financial institutions retain the authority to impose lower thresholds based on their internal risk assessments, allowing for tailored approaches to customer oversight.
For clients engaged in regular large transactions, the enhanced due diligence will be applied on a per-customer basis rather than per transaction. This change is designed to streamline processes for frequent users while maintaining vigilant monitoring.
Background and Amendments
Circular 1230 amends the earlier BSP Circular 1218, which was issued in September 2025 with a PHP500,000 threshold aimed at curbing money laundering and preventing illicit financial activities. The updated regulation reflects evolving market practices and risk assessments, ensuring that policies remain effective and responsive to current financial landscapes.
It is also noteworthy that there is no specific threshold for non-cash withdrawals, highlighting the BSP's targeted approach to cash-based transactions where risks are often more pronounced.
