Philippines Eyes Easier Credit Access Via Open Finance Data-Sharing Bill

A bill filed in the lower chamber of the Philippine Congress seeks to establish the country's first comprehensive legal framework for consumer-directed financial data sharing. The proposed measure, officially known as the Open Finance and Consumer Data Empowerment Act (House Bill No. 9149), aims to make everyday digital transactions serve as proof of creditworthiness, thereby improving access to financial services for many Filipinos who have historically faced difficulties. "The digital economy has outpaced our regulatory infrastructure. Filipinos are generating rich financial data every day through their phones, their e-wallets, and their utility payments. We aim to leverage that data to democratize access to financial tools and services that have long been unavailable for millions," said Tingog Party-list Representative Jude Acidre, one of the bill's co-authors. Once passed, the bill will grant consumers the legal right to authorize the transfer of their financial and transactional data, including alternative data sources such as bill payments, subscription activity, and rewards card usage, for up to 24 months. This data can then be shared with accredited lenders and financial service providers for credit evaluation purposes. Consequently, a consumer's transaction history could be used as a basis for credit assessment, allowing lenders to utilize alternative data to gain a full picture of an individual's creditworthiness. Todd Schweitzer, a board trustee at Fintech Alliance Philippines, expressed his support for the bill, stating that "Open Finance legislation matters because it accomplishes two things at once: it directly expands financial access for consumers, and it opens new markets for industry to competitively serve customers the system has ignored." He noted that while digital payments account for 57.4% of all retail payment transactions and an estimated 58 million Filipinos use e-wallets, a significant portion of the population remains unbanked. Schweitzer highlighted that "Filipinos are digital natives, though, and have rich data sources beyond banking data to demonstrate their creditworthiness. What's been missing is the legal right to put that data to work, and the mandate for data-holding institutions to provide that data upon the consumer’s request. This bill arrives at the right moment: the digital rails and data privacy standards are in place, demand is clear, and this bill would establish a pioneering framework to unlock a more consumer-centric financial services industry." Furthermore, the bill proposes the creation of a Consumer Data Commission (CDC) under the Office of the President. This commission would oversee not only banks and financial institutions but also telecommunications firms, utilities, and any entity collecting and holding consumer data. The commission would be chaired by a Securities and Exchange Commission (SEC) commissioner and co-led by at least a deputy governor of the Bangko Sentral ng Pilipinas (BSP). Its members would include representatives from the National Privacy Commission (NPC), the National Telecommunications Commission (NTC), and the Philippine Competition Commission (PCC), along with four private-sector representatives with expertise in banking, data protection, or financial technology. The commission's responsibilities would include setting technical and security standards for data transfers, accrediting entities authorized to receive consumer data, conducting compliance audits, and enforcing sanctions against violators. It would also be tasked with submitting an annual report to Congress on the state of consumer data rights and open finance implementation, and conducting a comprehensive review of the law every two years.