MANILA, Philippines — The Bangko Sentral ng Pilipinas has denied a marketing firm’s request to be registered as the operator of Lyka’s payment system, upholding an earlier halt order against the social media platform.
In a statement on Friday, the central bank encouraged Lyka, owned and operated by Hong Kong-based Things I Like Company Limited (TIL), to register itself as an operator of payment system (OPS) instead of the firm’s marketing agency, Digital Spring Marketing and Advertising Inc.
The central bank's decision effectively sustained the July 23 cease-and-desist order it issued against Lyka. Digital Spring had asked the central bank to reconsider its decision and register the marketing firm as the OPS of the platform, but the regulator ultimately rejected the appeal.
“Think of an OPS 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,” said BSP Deputy Governor Mert Tangonan.
Lyka, which shot to fame amid the pandemic, grew to size owing to many celebrities and countless local establishments using its gems (gift cards in electronic mode) in exchange for goods and services.
The BSP reiterated that the use of these redeemable gems for transactions deems Lyka an OPS. That said, Lyka could only continue its activities once it registers, which it or TIL has not done to date.
The central bank's action puts the status of Lyka users' redeemable credits in limbo. Philstar.com reached out to Lyka for comment but has yet to get a response.
According to the BSP, an OPS could come in many forms such as “cash-in service providers, bills payment service providers, and entities such as payment gateways and merchant acquirers that enable sellers of goods and services to accept payments, in cash or digital form.”
Back in July, Lyka partner merchants who were rattled by the BSP's decision reportedly flooded the platform with encashment requests.