efficient retail payment system. notwithstanding all of these developments, we recognize that the fintech narrative goes beyond just the bsp. in fact, more pioneering solutions are cutting across regimes of different regulators of the financial sector. this is why in the 3rd quarter of last year, the financial sector forum, composed of four financial regulators in the country, namely the securities and exchange commission ( sec ), the insurance commission ( ic ), the philippine deposit insurance corporation ( pdic ) and the bsp, formed a fintech committee aimed at harmonizing regulatory responses to fintech innovation in the financial sector. among the priority agenda that the fsf - fintech committee undertook was identifying the numerous fintech use cases and the scope of authorities of each regulators. through clear understanding and increased collaboration, financial regulators can quickly anticipate changes, assess technological trends across different sectors, and optimize the potential of digital innovations to provide more convenient, and efficient financial services. the cross - cutting nature of fintech developments has also magnified the importance of shifting to activity - based regulations. likewise, i am pleased to share that the fsf - fintech committee is in the initial stages of crafting a cooperative oversight framework which will institutionalize our collaboration and clarify regulations to all supervised and would be supervised entities. but again ladies and gentlemen, we are just one side of this financial equation and we need your support in striking the balance of ensuring that regulatory and supervisory frameworks are in tune with emerging trends and developments. we hope that you can actively help us shape this narrative into something that is desirable, safe, sustainable, inclusive and rewarding for all stakeholders, most especially the filipino people. 3 / 4 bis central bankers'speeches as we move forward in this collaboration, i hope that we all keep the benefit of the filipino people in mind. thank you for the opportunity and i am looking forward to engaging conversations with all of you. needless to say that the bsp, as your partner in promoting financial innovation and inclusion, will remain dedicated and committed in supporting beneficial fintech innovations through an enabling policy and regulatory environment. thank you and i wish everyone a fruitful conference. 4 / 4 bis central bankers'speeches

must be effectively managed and that the financial system remains safe and sound. 1 / 4 bis central bankers'speeches the first lane refers to collaborative engagements. the continuing collaboration with industry players and other financial regulators represents a “ whole - of - government approach ”, ensuring policy consistency and minimizing, if not fully preventing, regulatory arbitrage. with this in mind, the bsp openly engages with fintech players and innovators through a flexible “ test and learn ” environment or the “ regulatory sandbox ” that enables us to fully understand emerging business models while assessing attendant risks. i will not dwell on specifics but generally, the framework consists of five important steps commencing from the enabling stance adopted by the bsp during initial engagement with the applicant, guided and clear rules for implementation, until continuing monitoring of matured services. with such an approach, we are able to timely employ risk - mitigating actions and craft appropriate policies revolving around consumers ’ welfare and protection and secure financial system. the middle lane refers to our capacity building initiatives. in 2018, we established a dedicated financial technology subsector ( ftss ) to institutionalize the operational and cyber - resilience of the financial system. under ftss is the technology risk and innovation supervision department ( trisd ), which is primarily responsible for conducting onsite and offsite it supervision of regulated entities, as well as maintaining a comprehensive and flexible regulatory framework relating to it supervision. trisd is also in charge of cybersecurity surveillance and promoting digital or fintech innovation through bsp ’ s regulatory sandbox. equally important is the payment systems oversight department ( psod ) which is mainly responsible for the payments oversight, licensing and policy development for a safe, efficient and reliable national payment system. it espouses on the use of technology as enabler of innovation in payment systems and is the lead in enforcing a holistic payment oversight framework, including the national retail payment system. we are also in the midst of implementing solutions that make use of artificial intelligence and machine learning for regulatory and supervisory processes. these regtech and suptech tools aim to augment areas of risk management, regulatory reporting, consumer complaint oversight and regulatory compliance automation. this includes a chatbot, an automated complaint - handling system which uses predictive analytics to address consumer concerns and an api that automates the collection, processing, and analysis of data from supervised institutions. supervised entities that cannot immediately migrate to the api - based reporting can use the fi portal