EMERGING financial technologies (fintech) will bring true financial inclusion to many Filipinos who remain unbanked to this day, tech industry leaders said in a recent forum.
More than 71 percent of Filipinos remain unbanked and have zero access to financial services, based on the 2019 survey of the Bangko Sentral ng Pilipinas (BSP).
This unbanked sector includes aspiring entrepreneurs and micro, small and medium enterprises or MSMEs, resulting to their inability to secure funding and support to expand their businesses.
Emerging solutions are open finance and the API (application program interface) economy, which are innovations that can provide financial access to the underserved while protecting consumer data, confidentiality, and financing, said Amor Maclang, Digital Pilipinas and World Fintech Festival convenor and Fintech Philippines Association (FPH) trustee and executive director.
“We hope to be able to surface best practices that will help us transform our industry together, and in the process create a virtuous cycle that will be more pro-consumer. Through all these efforts, we aim to ladder up to a joint national Open Finance journey,” she said.
The hurdles and solutions to financial inclusion, data protection, and consumer empowerment were addressed by Maclang and other industry leaders in the recent virtual event titled, “Teching Up Consumer Financing: Consumer Protection in Financing in an API Enabled World.”
In terms of real benefits to the consumers, the era of open finance will also introduce the democratization of data.
Jerome Eger, the chief executive officer of Smile API, said an API that facilitates the rapid and secure exchange of employment and financial data, adding that APIs are about the “removal of these thresholds and to make your own data available for the best use, and in your interests.”
He said in the era of open finance, even the unbanked will have access to financial services, as APIs’ functionality can check on alternative data points such as e-wallets like GCash or Paymaya.
Todd Schweitzer, founder and chief executive officer of Brankas, also expressed his enthusiasm over how the government is dealing with open finance and API development. “In the Philippines, they’re following a great trajectory. What they are doing is they’re building a fence and they are saying: ‘Here is the fence, the perimeter, there are certain IT and operational tech standards that need to be in place. And as long as you have those in place, we the regulators will allow innovation to happen,'” he said.
Source : From the Web