The future of AI in Philippine BFSIs: Contextual, connected, compliant

By David Irecki

THERE’S A MOMENT in every new technology journey when the “training wheels” eventually come off. That moment appears to have arrived for agentic artificial intelligence (AI). The move from experimentation to specialization is clearly picking up speed as governments and industries race to build sovereign and sector-specific AI ecosystems across healthcare, education, manufacturing, and finance.

If we look at the Philippines, banking, financial services, securities, and insurance (BFSI) companies in particular are stepping into a new phase of AI adoption aimed at improving customer experience, risk management, and efficiency. In 2024, a Bangko Sentral ng Pilipinas (BSP) survey found that 44% of institutions had implemented at least one AI system in production, while 60% had formally included AI/machine learning in their future plans.

Today, the challenge in adopting AI goes far beyond automation. Institutions have to make sure AI works seamlessly within legacy systems, is contextually relevant, interoperable, and meets regulatory requirements.

In practice, the path to AI success must align with the three C’s of staying contextual, connected, and compliant.

GETTING THE FULL PICTURE

With AI adoption, the measure of success is not how big the model is but how intelligently it understands context. In a country as linguistically diverse as the Philippines, with 184 living languages including Tagalog, Cebuano, Ilocano, and countless mixed-language communications, AI systems must be able to have a good grasp of local languages and their nuances.

Understanding diverse customer behaviors and inquiries in these languages opens the door to personalized, automated services at scale.

Financial institutions, for instance, can analyze customers’ past purchases to better understand their hobbies and lifestyles, then offer tailored promotions to encourage higher engagement. They can also examine an individual’s payment patterns to estimate the risk of default.

Moreover, contextual AI can enhance digital onboarding and electronic Know-Your-Customer processes by interpreting customer data accurately and detecting anomalies.

At its core, contextual AI creates experiences that are relevant, personalized, and trustworthy.

CONNECTING BEYOND
THE SURFACE

The BSP found that despite growing adoption of comprehensive monitoring and data management practices, legacy system integration continues to pose a significant challenge.

Nevertheless, AI cannot operate in isolation. It is only as effective as its ability to operate across systems. Bringing all data under a single, unified architecture can remove bottlenecks and make the flow of information more transparent, which is why many institutions would benefit from investing in such platforms.

In this context, modern integration platform as a service (iPaaS) is set to become the crucial connective layer that links sovereign platforms, legacy systems, and agentic environments without compromising governance or compliance.

Being connected will transform AI from siloed intelligence into a capability that spans the entire enterprise. This allows BFSIs to use AI to its fullest and stay competitive in a market increasingly dominated by AI-driven decisions.

COMPLIANT EQUALS RESPONSIBLE

The reality is that AI adoption cannot happen without confronting risks such as data quality issues, inaccuracies, hallucinations, and ethical challenges.

One concern the BSP highlighted in its maturity assessment is that governance is the weakest link in AI adoption among Philippine BFSIs, scoring just 0.9 out of 5, far below data, models, and tools at 2.1 — with the majority not even having a policy to specifically assess or tackle AI risks.

Failing to establish formal AI policies can actually put these institutions at risk of legal breaches, while inconsistent oversight may lead to unlawful use of customer data, regulatory sanctions, and reputational damage.

Although AI-specific legislation does not yet exist in the Philippines, regulations like the Data Privacy Act of 2012 and BSP’s Circular No. 808 on IT risk management establish important foundational principles that may guide institutions in managing these risks responsibly.

Institutions need to put AI guardrails and governance in place sooner rather than later. But addressing these gaps also requires keeping humans in the loop because how AI systems are designed and used ultimately determines their impact.

THE NEXT FRONTIER

Agentic AI is moving beyond being just a playground for experimentation. Organizations now need to scale AI from pilots to full enterprise adoption, and they must do so strategically as well as responsibly.

Ultimately, it is the organizations that can seamlessly connect data, systems, and AI agents across sovereign and sector boundaries that will shape the next chapter of digital progress.

Looking ahead to 2026, achieving interoperability will likely become the real test of an organization’s competitiveness. It is this quality that will separate leaders from laggards in the race for AI-driven advantage.

DAVID IRECKI is the Boomi chief technology officer for APJ.