MANILA, Philippines—The central bank will draw a unified policy governing the handling and use of digital data gathered by banks from their clients—a framework that would be in line with international standards, the regulator said.
At a press briefing, Bangko Sentral ng Pilipinas (BSP) Governor Benjamin Diokno said that, to achieve this, the BSP will conduct what he said was baselining exercise first gather industry data for use in crafting the policy on data governance and its ethical use for financial institutions.
“The baselining exercise will look into processes vis-à-vis the global standards set under Basel Committee on Banking Supervision 239 Principles,” he said.
The Basel principles aimed to strengthen risk data gathering capabilities and internal risk reporting practices to enhance risk management and decision-making processes among banks.
The proposed framework aims to provide high-level principles and supervisory expectations on financial institutions’ data governance and ethical use of data.
The central bank will issue a discussion paper on the proposed policy for comment of the industry after the baselining exercise. The discussion paper is expected to be released within the first half of 2021.
“The rise in e-payments during the pandemic provides the BSP with greater impetus to balance its promotion of financial inclusion and digital finance with the need to ensure consumer information security,” Diokno said. “The upcoming policy aims to establish robust infrastructure and data standards amid the broader use of digital payment platforms.”
The digital governance framework is a key initiative under the BSP’s Digital Payments Transformation Roadmap.
The proposed policy will be in addition to the current governance standards on the protection and privacy of consumer data found in the BSP’s enhanced guidelines on information security management and consumer protection framework.
In formulating the digital governance standards, Diokno said the BSP will be guided by its mandate under the New Central Bank Act to promote broad and convenient access to high quality financial services while protecting the interest of the general public.