The Bangko Sentral ng Pilipinas (BSP) endorsed the guidelines of the Open Finance Framework, touted as the “main catalyst for digital transformation and financial inclusion” in the country.
“Open Finance is certainly not a sprint but a marathon,” BSP Governor Benjamin E. Diokno said over the weekend. Open Finance is part of BSP’s digital payments transformation roadmap.
“It will be a long and difficult race, but like any other sport we have to prepare and condition ourselves properly to finish strong in this race,” he added.
The BSP Monetary Council approved the new guidelines for the implementation of Open Finance in Circular 1122 of June 17. Fundamentally, Open Finance is “consent-based data portability” as well as interoperability and collaborative partnerships between third-party providers (TPP). It covers technology, products, services, information, which “enable customers to share their financial data securely” with banks and qualified TPPs.
The BSP said that with Open Finance, consumers have the power to grant banks or TPPs access to their financial data for a “customer-centric product development goal.”
“PASB expects multi-level implementation of the framework depending on the sensitivity of the data and the types of data and data holders. Levels are not necessarily sequential and multiple implementations can occur at the same time, ”BSP said.
There are five levels in the BSP policy for Open Finance. PASB explained it this way: the first level involves sharing information about products and services and other details about financial products / services that are already easily accessible online; the second level involves sharing information about subscriptions and new accounts; and the third level involves the sharing of account information or personal and financial information provided by a customer.
The fourth level in the meantime covers transaction data, such as payments and other financial transaction data, while the fifth level covers those that are not covered by levels 1 to 4 and other financial products or cases. more complex use.
PASB released the draft Open Funding Circular in December 2020 and it included the proposal to create an Open Funding Oversight Committee (OFOC), which is an autonomous body led by the sector and recognized by the BSP.
OFOC will exercise governance over the activities and participants of the Open Finance ecosystem, BSP said. The BSP will oversee OFOC which should promote non-discriminatory membership.
Diokno said earlier that by establishing an open funding ecosystem, PASB consulted with global subject matter experts, conducted a survey of financial institutions overseen by the PASB, and conducted a comparative study of the regulatory landscape in other jurisdictions. .
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