The Philippine Amusement Gaming Corp. said its revenues have dropped by 49% after e-wallet providers removed online gambling features from their platforms in August.
The House committee on games and amusements held a hearing on Wednesday, October 22, to discuss how online gambling has affected the country and what measures are being taken to curb it.
Several lawmakers, including Rep. Jonathan Keith Flores (Bukidnon, 2nd District) and Rep. Chel Diokno (Akbayan Party-list), have filed bills that seek to either prohibit e-wallets from promoting online gambling, impose betting limits, or ban online gambling altogether.
During Diokno’s interpellation, PAGCOR Assistant Vice President Jessa Mariz Fernandez said the regulator’s monthly income declined to P2.9 billion in September from P5.7 billion in May.
She told lawmakers that the steep drop likely stemmed from the Bangko Sentral ng Pilipinas’ move to have e-wallets and other payment platforms such as GCash and Maya remove links and icons that led users to gambling sites.
The central bank, which oversees financial institutions in the country, issued the order on August 14 after a Senate hearing seeking to legislate stricter regulations on online gambling or implement an outright ban.
Asked if the decline is expected to continue, Fernandez said PAGCOR will likely fall short of its earlier forecast of P60 billion in gross gaming revenue by the end of 2025, especially when 60% of their revenue comes from online gambling.
Fernandez explained that 30% of gross gaming revenues are remitted to the government, 25% to PAGCOR and 5% to the Bureau of Internal Revenue as franchise tax. Gaming operators keep the remaining 70%.
As of September, PAGCOR said it had generated a total gaming income of P40.57 billion for the year. Fernandez said the downward trend was most apparent in August following the BSP’s directive and the subsequent compliance of e-wallet providers.
She added that the regulator also noticed a slight decrease in the number of new online gambling players over the past few months.
How do e-wallets earn from gambling?
Lawmakers then turned to e-wallet platforms, asking them how they benefited from serving as payment channels for online gambling operators.
Maya Corporate Affairs Head Toff Rada said they treat PAGCOR-licensed gaming operators as merchants, which means they ‘get a certain percentage out of every transaction’ from top-ups made by account holders.
G-Xchange Inc. Head of Advocacy Mark Anthony Amurao confirmed that GCash had implemented the same measure. He clarified that no deductions were made from users’ accounts, as online gambling operators were the ones paying the agreed-upon rate.
Rafa said the ‘industry rate,’ to his knowledge, is around 2% to 3%. GCash declined to disclose its own rates, citing confidentiality under its agreements with operators.
The BSP told lawmakers it has drafted a circular outlining new rules for payment platforms, including restrictions on betting amounts, limited top-up windows for gaming accounts, and a ban on using online loans for gambling.
‘In other words, when you start to engage in online gambling, we require that the bank or the e-wallet or the e-money issuer would sever the link from the lending,’ BSP Deputy Governor Mamerto Tangonan said.
Other planned features include pop-up alerts, account self-disabling tools for online gambling, and a blanket ban on ads and links in banking platforms.
Since e-wallets removed the in-app links to online gambling, reports have shown players shifting to illegal platforms, since these do not have minimum bets or limits on how they can top up their gaming accounts.
PAGCOR said 93% of the 13,399 illegal sites reported since 2022 have already been blocked by the National Telecommunications Commission.