BSP lays down rules on AI use to guide banks, financial institutions

The Bangko Sentral ng Pilipinas (BSP) on Tuesday announced the issuance of governance principles to guide BSP-supervised financial institutions (BSFIs) in adopting artificial intelligence (AI).

In a news release, the BSP said the guidance aims to help financial institutions harness AI to improve services while protecting consumers and preserving trust in the financial system.

The Governance Principles for Artificial Intelligence in Financial Services were issued through Memorandum No. M-2026-031, dated June 24, 2026. The memorandum provides guidance for BSFIs in developing their own AI governance and risk management frameworks.

According to the OECD Business and Finance Outlook 2021, banks and other financial institutions are increasingly using AI across a wide range of operations, including fraud detection, anti-money laundering monitoring, credit scoring, and customer service through chatbots and virtual assistants.

AI is also being used for personalized financial recommendations, cybersecurity, regulatory compliance, the automation of routine back-office processes, and the analysis of large volumes of transaction data to detect suspicious activities and strengthen risk management.

The BSP said the framework promotes the responsible and ethical use of AI through five key principles: sustainability, transparency, accountability, responsibility, and security (STARS).

"AI is spreading across BSFI operations, and STARS provides them with principles that can help them innovate while mitigating unintended consequences from the use of the technology," BSP Deputy Governor Lyn Javier said.

"We want BSFIs to take advantage of AI, especially to better serve their customers, while being guided by evolving global standards," she added.

The BSP said the memorandum applies to all BSFIs.

It added that the implementation of the principles should be proportionate to the nature, extent, scale, complexity, and materiality of an institution's AI systems, as well as to its overall operational complexity and risk profile.

The guidance also covers outsourced service providers that support AI-related activities under a shared responsibility model.

The BSP clarified that the principles are voluntary and non-binding.

However, it said the memorandum reflects the central bank's minimum supervisory expectations for the adoption and governance of AI.

BSFIs are encouraged to integrate the principles into their governance frameworks, risk management strategies, and operational processes.

Meanwhile, the BSP said risks associated with emerging technologies will continue to be addressed under its existing Information Technology Risk Management framework, which covers areas such as information security, outsourcing, and project management.— MCG, GMA News