In any case, the BSP observes the following principles in its regulatory approach to innovations in the financial services sector: (i) risk-based supervision, (ii) active stakeholder engagement; and (iii) consumer protection. “Risk-based” means BSP-regulated entities are enjoined to put up the necessary risk management systems and sufficient capital to cover their respective levels of exposure to technological risks.
“Active stakeholder engagement” means the BSP is actively engaging supervised entities to constantly get updates from them on innovation trends that the regulatory environment should capture. “Consumer protection” means financial institutions offering fintech-enabled services are required to have the necessary safeguards to ensure the protection of financial consumers against ITrelated fraud and data compromise.