BSP Warns Banks on Digital Vote Buying Risks

The Bangko Sentral ng Pilipinas (BSP) has called on banks and other financial institutions to tighten their systems against the potential misuse of digital platforms for vote buying and selling ahead of the May 2025 national and local elections.

In Memorandum No. M-2025-006, signed on March 23, the BSP instructed all BSP-supervised financial institutions (BSFIs) — including banks, e-money issuers, and other licensed entities — to upgrade their fraud detection and transaction monitoring systems during the election period.

The central bank specifically raised concerns about the abuse of online banking services and mobile wallet applications, which are increasingly being used as channels for cash-based vote transactions due to their speed, accessibility, and anonymity.

The BSP urged BSFIs to improve customer onboarding processes (the procedures followed when opening a new account), fraud management systems, and account and transaction monitoring tools to detect and prevent suspicious activity.

In plain terms, this means financial institutions must watch out for suspicious patterns — like a sudden spike in new accounts from vote-buying hotspots, large or unusual cash transactions, and excessive money transfers via digital wallets.

The memorandum follows a similar pattern to advisories issued during previous election years, but the BSP noted that digitalization has changed how illegal election-related activities are carried out.

The directive also responds directly to a request by the Commission on Elections (COMELEC) through Resolution No. 11104, dated January 28, which called for tougher measures against vote buying and selling.

Vote buying, a longstanding election offense in the Philippines, has evolved from direct cash handouts to more discreet transfers through digital wallets and bank apps, raising challenges for enforcement agencies.

To strengthen enforcement, the BSP is working in coordination with the COMELEC and the Philippine National Police (PNP) in monitoring and addressing digital vote buying schemes.

The BSP emphasized that financial institutions must remain alert to “red flags,” including:

– Spikes in account openings in high-risk areas

– Unusually large or frequent cash deposits and withdrawals

– Irregular usage patterns in mobile wallets

– High-volume cash-ins or cash-outs that don’t match usual customer behavior

Vote buying and selling are criminal offenses under Philippine law, punishable by imprisonment and disqualification from holding public office. The challenge for authorities has grown with the rise of fintech and e-wallet services, which now serve millions of Filipinos and have become popular for both legitimate and illicit transactions.