MANILA -- Bangko Sentral ng Pilipinas (BSP) considers consumer protection paramount in its regulation of the growing financial technology (fintech) industry in the country.
During a roundtable discussion on new technologies in finance held on Thursday at the ADB Headquarters in Mandaluyong City, BSP Governor Nestor Espenilla recognized the role of fintech in promoting financial inclusion, hence the need for a balanced regulatory approach to engage new players.
"It is a reality in the Philippines that many are excluded from the mainstream financial system. I’ve realized that we will not be able to reach those people who are excluded from the system going by the traditional methods of banking. We have come to realize that fintech is our ally here," Espenilla said.
"With that mindset, we have created an environment that enables fintech to come in many forms. They can come in as a player in their own right, but they could also ally with the incumbents, with the traditional players to solve the people’s problem," he added.
Espenilla said protecting the consuming public is a very important element in regulation amid the technological advances in finance, noting that it should address the issues of security, confidentiality, fairness of treatment, and transparency.
He also noted that a risk-based supervisory approach is another principle to consider in regulation, as well as a collaborative approach with these innovative companies who "probably have no experience in financial services but have technological solutions."
"We are seeing a lot more alliances happening--fintech companies working with banks and banks embracing technology so that they can do things better. This combination is really in our minds a win-win proposition," he said.
The BSP earlier cited a report stating that the value of fintech transactions in the country is expected to grow at an annual rate of 19 percent over a period of four years. (PNA)
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