Open Finance |
OFOC |
Pilot
As a component of its overall strategy, the Bangko Sentral ng Pilipinas (BSP) issued 2021 BSP Circular No. 1122 which lays out the guidance for the development of a framework for open finance. The OFOC TG will be called upon to help shape, promote, develop, and oversee elements of an innovative and inclusive market for open finance services. Read on to find out more.
Open Finance in the Philippines
“Open Finance refers to leveraging on and sharing of customer-permissioned data among banks, other financial institutions, and
Third Party Providers (TPPs) to develop innovative financial solutions, such as among others, those that provide real-time payments, greater financial transparency options for account holders, marketing, and cross-selling opportunities.” The Open Finance Framework aims to empower customers by giving them better control over their personal and financial data catalysing the development of products and services that are responsive to their needs. Under the framework, financial institutions and TPPs can leverage on permissioned-access customer financial information to develop bespoke financial products and services for customers.” “It is the thrust of the Bangko Sentral to promote an enabling environment that foster innovation, encourages coopetition, and advances financial inclusion while safeguarding the integrity and stability of the financial system.”
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here to find out more.
The Open Finance Oversight Committee Transition Group
In November 2021, through its circular letter no 090, the BSP recognised the Open Finance Oversight Committee Transition Group (OFOC TG) as the interim governing body to lead the constitution of a formal body and facilitate the development of participation arrangements, technical standards and other common guidelines. This group was formed and representatives appointed in January 2022, with the publication of Circular Letter No. CL-2022-002.
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here to find out more about the OFOC TG.
The Philippine Open Finance Pilot
The Philippine Open Finance Pilot (“PH Open Finance Pilot”) is a collaborative undertaking of financial institutions, participating on a voluntary basis, to explore the use of Application Programming Interface (API) technologies in the delivery of financial products and services responsive to the needs of customers. The activities of the PH Open Finance Pilot is governed by the provisions of BSP Circular No. 1122 on the Open Finance Framework, and monitored by the Open Finance Oversight Committee Transition Group (OFOC TG).
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here to find out more about the PH Open Finance Pilot.
Open Finance is a global phenomenon bringing benefits to all stakeholders. The Open Finance Framework aims to promote collaborative partnerships and digital transformation as key enablers towards economic resilience and financial inclusion. In establishing a more defined program for the implementation of Open Finance in the country, the BSP has adopted the three-year Open Finance Roadmap 2021-2024.
What is Open Finance?
Open Finance is the extension of data sharing principles, assigning greater control to customers over their own data and 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. “Open Finance” refers to leveraging on and sharing of customer-permissioned data among banks, other financial institutions, and TPPs to develop innovative financial solutions, such as among others, those that provide real-time payments, greater financial transparency options for account holders, marketing, and cross-selling opportunities."
The Open Finance Framework
In 2021, as a component of its overall strategy, the BSP issued the Open Finance Circular Number 1122 laying out guidance for the development of a framework for open finance. In establishing a more defined program for the implementation of Open Finance in the country, the BSP has adopted the three-year Open Finance Roadmap 2021-2024. The roadmap 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 Open Finance Oversight Committee Transition Group
In the words of BSP Circular on Open Finance No 1122. “The Open Finance Framework aims to empower customers by giving them better control over their personal and financial data catalysing the development of products and services that are responsive to their needs. Under the framework, financial institutions and TPPs can leverage on permissioned-access customer financial information to develop bespoke financial products and services for customers.” “It is the thrust of the Bangko Sentral to promote an enabling environment that foster innovation, encourages coopetition, and advances financial inclusion while safeguarding the integrity and stability of the financial system.”
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OFOC TG
In November 2021, through its circular letter no 090, the BSP recognised the Open Finance Oversight Committee Transition Group (OFOC TG) as the interim governing body to lead the constitution of a formal body and facilitate the development of participation arrangements, technical standards and other common guidelines. This group was formed with the representatives appointed in January 2022, with the publication of BSP Circular Letter No. CL-2022-002.
OFOC TG responsibilities
The OFOC TG is expected to carry out its activities for a term of no longer than two (2) years from its inception, or upon the establishment of the OFOC. Members of the OFOC TG, are tasked to facilitate the initial policies and standards formulation and support pilot implementations under the Open Finance regulatory sandbox. Each member acts as a representative of his /her respective industry (i.e., UKBs, TBs, RBs, Digital Banks, EMI- Others, OPS, and FinTech).
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CATEGORY |
PRIMARY |
ALTERNATE |
| Universal and Commercial Banks (UKBs) |
Mr. Jonathan John B. Paz
Vice-President and Data Protection and
Enterprise Information Security Officer,
Bank of the Philippine lslands (BPI) | Mr. Frederick M. Faustino
Division Head, Business Development and
Onboarding, Digital Channels Group,
Bank of the Philippine lslands (BPI)
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Thrift Banks (TBs) |
Mr. Emmanuel A. Tuazon
Senior Vice President and Head of Marketing and
Communications Group,
Philippine Savings Bank (PSBank) |
Mr. Noli S. Gomez
Executive Vice President and
Operations Croup Head,
Philippine Savings Bank (PSBank)
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Rural Banks (RBs) | Ms. Tanya P. Hotchkiss
Executive Vice President,
Cantilan Bank, Inc. (A Rural Bank) | Mr. Paulo R. Honrado
Chairman and President,
Rural Bank of Guinobatan
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Digital Banks (DBs) |
Ms. Maria Lourdes Jocelyn S. Pineda
President,
Tonik Digital Bank, Inc. (TONIK) | Mr. Melvin M. Ramis
Chief Technology Office,
Tonik Digital Bank, Inc. (TONIK)
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E-Money Issuer-Others (EMI- Others) |
Mr. Wilfred G. Tan
Chief Technology Officer,
OmniPay, Inc. (OMNIPAY) |
Ms. Anna Liza Eugenio-Alicastre
Chief Operating Officer,
OmniPay, Inc. (OMNIPAY)
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Operators of Payment Systems (OPS) |
Mr. Dennis S. Gatuslao
Chief Commercial and Marketing Officer,
CIS Bayad Center, Inc. | Atty. Guadalupe Lyn P. Vergel de Dios
Head of Compliance and Government Relations,
Xendit Philippines, Inc. |
FinTech
|
Ms. lmelda C. Tiongson
Trustee,
FinTech Alliance.ph |
Atty. Mark S. Gorriceta,
Managing Partner,
Gorriceta Africa Cauton & Saavedra
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PILOT
The Philippine Open Finance Pilot (“PH Open Finance Pilot”) is a collaborative undertaking of financial institutions, participating on a voluntary basis, to explore the use of Application Programming Interface (API) technologies in the delivery of financial products and services responsive to the needs of customers.
About The Philippine Open Finance Pilot
The activities of the PH Open Finance Pilot is governed by the provisions of BSP Circular No. 1122 on the Open Finance Framework, and monitored by the Open Finance Oversight Committee Transition Group (OFOC TG). The PH Open Finance Pilot, which operates through the support of the International Financial Corporation (IFC), will inform the development of open finance technical and operational standards and arrangements. The Bangko Sentral ng Pilipinas recognizes that the PH Open Finance Pilot is an important initiative in promoting a responsive, inclusive and responsible digital financial ecosystem that is characterized by innovation-driven use of consumer data. Through support provided by IFC, an independent Pilot Administrator will facilitate the coordination necessary between participants to manage this process in an inclusive, transparent and non-discriminatory manner under the guidance of the OFOC TG and as required by Circular No. 1122.
Pilot timeline
Following the creation of the Open Finance Rule and standards and the kick off meeting in June, the Pilot is open for business and will run throughout the second half of 2023. PH Open Finance Pilot Timeline.
Open Finance - Journey and Milestones
Information about Standards Definition
The Pilot is based on Rules and Standards created by the Standards Consultation Working Group (SCWG). Further information can be found below:
SCWG members: The list of SCWG members and the formation of the group is here. About the Pilot Rules and Standards: This presentation explains the purpose of the rules and standards.
Standards Consultation Group Formation.pdfStandards Definition Summary of Activities: This document explains the main milestones and achievements of the Standards Consultation Working Group (SCWG) each month.
Standards Definition Summary of Activities.pdf
Standards Consultation Working Group Ways of Working Document: These documents outline the context, deliverables, topics discussed, and cycle schedules of the SCWG.
Standards Consultation Working Group Ways of Working.pdf The Standards Consultation Working Group (SCWG) was established in March 2023 and have completed 3 cycles of review and delivery of the Pilot Arrangements which will be used during the Pilot phase.
Information about the Pilot
There are a number of documents that describe the Philippines Open Finance program, and the pilot:
Pilot Description: The Pilot description provides a summary of the Pilot, including roles and actors and main use cases covered.
FAQ: The FAQ document contains questions and answers on Open Finance Basics, About the Pilot, Participation in the Pilot, and About the Standards.
FAQ.pdf
