THE BANGKO SENTRAL ng Pilipinas (BSP) has further relaxed its foreign exchange (FX) rules by making it easier for the private sector to tap such currencies, the monetary authority said in a press release on Friday.

The latest reform was approved by the Monetary Board “in line with the (Central) Bank’s thrust to further open up the economy through a more liberal policy environment”, the statement read, explaining that the latest moves “aim to promote greater ease in the use of the FX resources of the banking system for legitimate needs by further relaxing FX rules and further streamlining procedures and requirements”.

This initiative, in turn, aims ultimately “to help support economic activities”.

The circulars concerned, which BSP said will take effect on Jan. 15, 2018:

• remove as prerequisite for purely private sector loans — those without guarantee from or exposure of any government entity — prior central bank approval, requiring such loans only to be registered with the monetary authority. “The revised rules aim to further facilitate financing of critical, urgent projects and activites that can contribute to a more vibrant business climate conducive to growth,” the BSP said in its statement.

• open a six-month window during which purely private sector loans obtained without required BSP approval, and recorded in borrowers’ books as of the date of the circulars, can be registered with the central bank following the new guidelines. “BSP registration of these accounts will qualify the outstanding balances of the obligations to be paid… using FX resources of the banking system,” the statement explained. “Previously, these loans could be settled only with the borrower’s own FX or with funds sourced outside the banking system.”