The Securities and Exchange Commission (SEC) has launched the PhiliFintech Innovation Office (PIO) to pave the way for more innovations in the fintech industry to further promote financial inclusion while also protecting investors and other financial consumers.
The PIO is under the SEC’s Corporate Governance and Finance Department (CGFD) and will focus on the regulation of the use of fintech, or financial technology, in the Philippines.
The PIO is mandated to reduce gaps in consumer and investor protection tempered by financial inclusion, integrity, and stability through a dedicated focus on the regulation and growth of fintech activities.
It will also create better-informed policies for new and existing fintech innovators as well as empower the SEC with expertise to effectively regulate fintech activities and promote an innovative culture in the corporate sector.
“Integral to our mission of championing the business sector, the capital market and the investing public, is fostering innovation,” SEC Chairperson Emilio B. Aquino said in a virtual press conference.
He added that, “Accordingly, the Commission has supported new and emerging business concepts while taking a proactive stance against any excessive risk buildup to ensure market integrity. The PhiliFintech Innovation Office will be at the forefront of building an enabling regulatory environment for fintech, in particular.”
Regulating innovative trading markets and technology-based ventures is part of the mandate of the SEC, as provided under Republic Act No. 8799, or the Securities Regulation Code.
The SEC previously supervised the registration and granting of licenses for non-traditional securities and instruments through its Non-Traditional Department, which was later abolished following the creation of the Insurance Commission in 2010.
The Commission has since delegated the regulation of non-traditional securities and fintech initiatives to other departments and treated them on a case-to-case basis.
To better prepare the country for fintech innovation, the SEC created the PIO in order to give greater regulatory focus on the industry.
The PIO will facilitate the processing of the registration of new fintech companies along with the appropriate department of the Commission.
It shall likewise serve as the first point of contact for existing fintech companies, which have been operating without proper regulation or authorization, or which will introduce new fintech products.
The PIO shall document, analyze, and understand fintech business models and their possible impacts on the market and its participants.
With this, the SEC will be able to formulate and execute regulatory responses geared toward protecting investors and market participants, while concurrently promoting the growth of fintech firms.