The management of Lyka/Things I Like Company Ltd (TIL) Payment System said that it respects and will abide by the findings of the Bangko Sentral ng Pilipinas that the registration as Operator Payment System (OPS) should be accomplished by the company itself and not through a local third-party.
In a statement, Lyka/TIL said it shall register as an OPS as directed by the BSP and will immediately put up its own office in the country.
Lyka/TIL added that it will be terminating its partnership with Digital Spring Marketing and Advertising, Inc.
“It is unfortunate that we may have to end our partnership with Digital Spring as we take on the challenge of operating in the Philippines on our own. However, all contracts entered into by our local partner shall be transferred to the new company, and all of its obligations and signed agreements shall be honoured. We shall remain faithful to the Lyka platform that our users and merchants have loved to integrate in their daily lives,” Lyka Global said.
On Friday, BSP has denied the request of Digital Spring to be registered as an OPS of the Lyka/TIL.
The BSP also upheld the cease-and-desist order (CDO) issued against Digital Spring last July, reiterating that Lyka/TIL and not Digital Spring should register as OPS with the BSP.
The BSP transmitted a letter to Digital Spring on its denial of the firm’s requests for reconsideration. In view of this, the CDOs against Lyka/TIL and Digital Spring dated July 23, 2021 “are affirmed and shall remain effective until Lyka/TIL properly registers as an OPS in accordance with law and regulations.”
Instead of challenging the BSP’s decision before a judicial forum, Lyka/TIL has determined that the fastest resolution to the matter is to “simply commence the registration of its own Philippine entity as an OPS, including setting up its own Philippine operations and equipping it with the best talent possible.”
“Lyka/TIL will continue to closely cooperate with BSP and other regulators in order to keep advancing LYKA Gems.”
BSP Deputy Governor Mert Tangonan said an OPS acts as a pilot who must personally obtain a flying license to prove that they possess the necessary skills and training to safely operate a passenger aircraft.
“Digital Spring applying for registration, instead of Lyka/TIL itself, is like saying the airline ticketing office can apply for a flying license on behalf of the pilot. It is the pilot who must apply for the license”, he added.
Lyka/TIL allows its users to purchase, exchange, and use Gift cards in Electronic Mode or GEMs as payment for goods and services. These activities make Lyka/TIL an OPS and, therefore, its registration is required before it can continue with these activities.
Lyka Gems is the first cashless and seamless social media gift card in the world.
Lyka/TIL said the addition of an internal entity in a social media hub like the Philippines “can only bring LYKA a step closer to its vision of becoming a global app conglomerate.”
“Just as we have established wholly owned subsidiaries in the United States, South Korea, Malaysia and Indonesia, Lyka Philippines will hire the crème de la crème when it comes to business operations and management. Lyka Management has commenced sourcing for a country head and the best support team for the Philippine operations that will fulfill its plans for the country and to support our vision as a leading social media app on a global scale,” Lyka/TIL said.
Digital payments continue to rise in the Philippines as the BSP on Friday said it has achieved target of 20 percent of digital payments in 2020.
The latest report of the BSP revealed that 20.1 percent of monthly payments volume are done digitally by end 2020, a substantial improvement over a span of a mere six-month period from the 2020 first semester estimates which pegged digital payments volume at 17 percent.
The value of digital payments likewise substantially grew from 25 percent to 26.8 percent for the same period.
Benjamin Diokno, BSP Governor, said the increased usage of digital payments was largely driven by high-frequency, low value retail transactions such as person-to-merchant payments and person-to-person (P2P) payments such as electronic fund transfers.
“While the COVID-19 pandemic may have disrupted our way of life, it also created exceptional opportunities to boost digital payments and financial inclusion in the country,” Diokno said.