December 26, 2020 — The two fintech groups in the Philippines: Fintech Alliance.PH and the Fintech Philippines Association have announced plans to collaborate in launching the “Philippines Fintech Industry Sandbox,” an initiative aimed at fostering the development of innovative financial services in the country.
First announced at the World Fintech Festival, the Philippines Fintech Industry Sandbox will be supported by the UK Prosperity Fund ASEAN Economic Reform Programme (ASEAN ERP) and in close coordination with the Bangko Sentral ng Pilipinas (BSP), the Securities and Exchange Commission (SEC), the Insurance Commission (IC), and the Department of Information and Communications Technology (DICT).
This Industry Sandbox initiative is envisioned to:
- Provide the fintech ecosystem with access to data, API, and reference architectures to allow entrepreneurs to create solutions that can be readily integrated with their current technology stack.
- Facilitate industry collaboration by addressing shared consumer, technological and regulatory challenges.
- Improve regulatory efficiency by encouraging regulators to observe while the industry shares its knowledge in the life cycle of solutions.
The ASEAN Financial Innovation Network’s (AFIN) API Exchange (APIX) will host the industry sandbox, as agreed upon by the two fintech groups. Using APIX, fintech companies and financial institutions can integrate and test solutions through the platform’s cloud-based architecture.
The Philippines Fintech Sandbox initiative will be closely coordinated with the BSP to ensure appropriate compliance guidance and the security of all the APIs, which will be free for small and medium sized developers.
In 2019, the BSP outlined its 3-lane fintech roadmap:
- First lane (Collaborative Engagement): Engage with fintech players and innovators through a flexible “test and learn” environment or regulatory sandbox.
- Middle Lane (Capacity Building Initiatives): Establish Financial Technology Subsector (FTSS) and the Technology Risk and Innovation Supervision Department (TRISD).
- Third Lane (Commensurate Regulations): Apply the same supervisory objectives of the BSP to fintech, ensure level playing field, and ensure the BSP will not hamper the innovation with unwarranted and excessive compliance requirements.
Lito Villanueva, Chairman of Fintech Alliance.PH said the organization is looking forward to this industry sandbox initiative to be realized. “This would promote greater collaboration and support towards sustainable innovations encouraging more players to participate ensuring consumer protection and regulatory compliance,” he said in a statement. Villanueva is also the Chief Innovation & Inclusion Officer of RCBC.
Dr. Justo Ortiz, Chairman of Fintech Philippines Association said this initiative, supported by the ASEAN ERP, will promote innovation in the fintech industry. “With this initiative we can truly Tech Up the country, one industry, one entrepreneur, one person at a time,” he said in a statement. Dr. Ortiz is also Chairman of the Board at UnionBank.
Alastair Totty, Charge d’Affaires at the British Embassy in Manila, said the U.K. is delighted to support the sandbox initiative through the Financial Services and Intellectual Property component of the ASEAN ERP. “The sandbox initiative is a key element in the country’s digital transformation that will help promote innovation and collaboration, and scale up business opportunities and sustainable economic recovery.”
This article is published on BitPinas: PH Fintech Groups Collaborate for Fintech Industry Sandbox