SEC introduces PhiliFintech Innovation Office
IN the Philippines, the Securities and Exchange Commission (SEC) is the national government regulatory agency charged with supervision over the corporate sector, the capital market participants, the securities and investment instruments market, and the protection of the investing public. This charge includes regulation of inherently high-risk market activity such as those engaged in by financial technology (fintech) firms.
And this is where fintech comes in. Fintech refers to innovation initiatives in the space where finance and technology meet. It is typified by service companies that use cutting-edge technologies as the main means of service delivery.
To date, the commission keeps itself up to date with the ever-changing developments in the fintech landscape to determine how it intersects with the jurisdiction of the SEC. In 2019, the commission issued rules and regulations on crowdfunding in recognition of recent financial innovation of raising funds for a venture or business using internet platforms. There were also efforts to draft the Initial Coin Offering or Digital Assets Offering and Digital Assets Exchange Rules. These rules are currently being reviewed and revised based on the comments received from several fintech proponents and the public. participation in the University of Cambridge Judge Business School’s Fintech and Regulatory Innovation Program, which is a tutor-led online program delivered to senior policymakers and regulators at central banks, security agencies and ministries of finance.
The commission has sent several cohorts to the said program, including myself, as part of the pioneer cohort in 2019. Participants learned the essential concepts concerning the technologies and business models that are transforming the financial industry. And just in April 2021, the fifth cohort for this course ended and our very own Chairman Emilio Aquino was a participant.
On that note, and based on the learnings of the SEC from the Cambridge course, and under the guidance and leadership of our chairman, the commission has moved to establish its own innovation office.
On June 3, 2021, the commission en banc resolved to approve the creation and establishment of a PhiliFintech Innovation Office, which shall be modelled after existing frameworks, structures and best practices of other jurisdictions, based on learnings from the Cambridge program, customized to fit the fintech landscape in the Philippines.
The office will be guided by the following objectives, which are to reduce gaps in consumer and investor protection balanced with financial inclusion as tempered by financial integrity and stability, through dedicated focus to the regulation of the increase of unauthorized or unregulated fintech; create better-informed policies for the regulation of new and existing fintech; and capacitate the commission with technical expertise to effectively regulate fintech and promote an innovative culture in the commission.
To get updates regarding the PhiliFintech Innovation Office, I invite everyone to monitor the SEC website at www.sec.gov.ph and official Facebook page at www.facebook.com.
PhilippineSEC for more information and further announcements.
Kelvin Lester K. Lee is a commissioner of the Securities and Exchange Commission (SEC). The views and opinions stated herein are his own. You may email your comments and questions to [email protected]