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Freeman Cebu Business

BSP adopts three-year open finance roadmap

Ehda M. Dagooc - The Freeman

CEBU, Philippines — The Bangko Sentral Ng Pilipinas (BSP) will adopt a three-year Open Finance roadmap, following the formal launching of Open Finance Framework in the country.

The Open Finance Roadmap 2021-2024 outlines priority actions that would require capacity building, development, and adoption of industry-accepted standards under a test-and-learn approach, and the implementation of a robust and scalable framework that is fundamental to establishing an Open Finance ecosystem.

The members of the Open Finance Oversight Committee Transition Group (OFOC TG), participating financial institutions and third-party providers in the regulatory sandbox, and international partners from the World Bank (WB) and the International Finance Corporation (IFC) joined the BSP in the launch.

 “As part of the core team that will drive this Open Finance initiative to impactful and life-changing opportunities for the ordinary Juan and Maria, all of us should mark this event with a sense of duty and responsibility to our nation and countrymen in elevating the level of financial inclusion and at the same time, maintaining the integrity of the entire financial system,” said BSP Deputy Governor Chuchi G. Fonacier in a statement.

The Open Finance Framework aims to promote collaborative partnerships and digital transformation as key enablers towards economic resilience and financial inclusion.

Open Finance is the extension of data sharing principles, assigning greater control to customers over their own data enabling them to allow third party providers access to their data across multiple financial products and services.

This can offer both businesses and individuals better financial products and services. It also provides financial institutions the opportunity to reduce their transaction costs, as well as the ability to better tailor their products to the evolving needs of customers.

“We must fully recognize the breadth and depth of Open Finance as it would entail a wide-ranging scope of activities covering a broader array of financial products and involving multiple stakeholders across the financial sector,” said BSP Assistant Governor Lyn I. Javier.

“Open Finance aims to provide customers with greater choice and control over how they interact with financial institutions. It can lead to deeper and more dynamic markets, in which customers enjoy a better experience, more choice, and better access to a range of financial products and services,” explained IFC Country Manager Jean Marc Arbogast.

Arbogast added that Open Finance can help accelerate financial inclusion by improving access to credit, improving the tools available for MSMEs to manage day-to-day finances and transactions, and alleviating the lack of digital documentation among Filipinos.

Arbogast further emphasized the continuing support and commitment of WB and IFC.

“We will draw on our extensive global network of experience in designing and implementing Open Finance in emerging markets,” Arbogast said.

In support to this endeavor, members of the OFOC TG, who are tasked to facilitate the initial policies and standards formulation and support pilot implementations under the Open Finance regulatory sandbox, were also officially recognized. Each member acts as a representative of his/her respective industry (i.e., UKBs, TBs, RBs, Digital Banks, EMI-Others, OPS, and FinTech).

The OFOC TG is expected to carry out its activities for a term of no longer than two years from its inception, or upon the establishment of the OFOC.

The BSP has made the firm resolve to be steadfast, persistent, and committed towards the attainment of an Open Finance ecosystem and enjoins everyone to work towards institutionalizing an Open Finance framework that champions collaboration, responsible innovation, and interoperable standards.

BSP

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