P1-M bank withdrawal scrutiny suspended

The Bangko Sentral ng Pilipinas (BSP) has temporarily suspended a policy requiring banks to conduct enhanced scrutiny of cash withdrawals exceeding P1 million, allowing legitimate transactions to proceed more smoothly during the Christmas season.

Under Memorandum No. M-2026-050, the suspension will run from Nov. 13 to Jan. 31, 2027.

The central bank said banks and other supervised financial institutions must continue to comply with antimoney laundering and counterterrorism financing laws, including conducting enhanced due diligence when customer or transaction risks warrant it.

They must also remain alert to suspicious activities, monitor transactions and file suspicious transaction reports when necessary.

At the same time, financial institutions should ensure that legitimate transactions are not subjected to unnecessary delays.

“The move is meant to support legitimate cash transactions during the holiday season when economic activities are expected to increase,” the BSP said.

The central bank raised the threshold for enhanced due diligence to P1 million in February, doubling it from the previous P500,000.

The policy was first introduced in September last year, following investigations into alleged irregularities in government flood control projects. The probe revealed allegations that lawmakers had received millions of pesos in cash from contractors as kickbacks.

The findings raised concerns about the use of the financial system to move illicit funds, prompting the BSP to tighten safeguards against money laundering.

Under the policy, cash withdrawals exceeding P1 million—whether made in a single transaction or through several transactions within one banking day—trigger enhanced due diligence by supervised financial institutions. The threshold does not impose a cap on how much customers can withdraw.

The value of banknotes withdrawn from the central bank rose 6.2 percent to P1.6 trillion in 2025, according to its annual report.

By volume, banknote withdrawals climbed 12.9 percent to 3.5 billion pieces, down from 20 percent growth a year earlier. Withdrawals of P100 and P50 bills led the increase, rising 25.3 percent and 44.3 percent, respectively.