Papua New Guinea’s financial sector is on the cusp of transformation, with Open Banking emerging as a catalyst for change, according to Michael Koisen, Group CEO of Tisa Bank.
Open Banking allows consumers to securely share their banking information with third-party providers through APIs, unlocking opportunities for new financial products and services. For PNG, this could address persistent issues such as geographic isolation and credit inaccessibility by fostering a collaborative ecosystem rather than isolated operations.
“Open Banking can create a collaborative ecosystem where financial data becomes a shared resource,” Koisen said. “This means more innovation, better products, and improved access to credit—especially for those in remote areas and the informal economy who have traditionally been underserved.”
The concept builds on Papua New Guinea’s existing Credit and Data Bureau, a platform enabling banks to share credit histories for smarter lending decisions. Open Banking would broaden the scope by allowing comprehensive financial data sharing, including account balances and spending patterns.
Koisen emphasized practical first steps, like a shared, unbranded Point-of-Sale network that could accept payments from any bank’s customers.
“This would reduce costs for merchants and serve as proof that collaboration works,” he said.
Beyond payments, Open Banking offers consumers several benefits. It enables personalized financial management tools that consolidate multiple bank accounts, simplifies loan applications through direct data sharing, and helps tailor relevant loan and savings products. Crucially, it can extend credit access to underserved groups, such as small business owners without formal credit histories.
Acknowledging inevitable hurdles—including regulatory frameworks and data security—Koisen called for coordinated action.
“The government, the Bank of Papua New Guinea, and financial institutions need to work together to create a clear roadmap for implementation,” he said.
Building on PNG’s successful Credit and Data Bureau and pilot projects like shared POS systems, Koisen views Open Banking as a pivotal investment in a more inclusive financial system. “It’s about unlocking value for all citizens and driving innovation that benefits the entire economy,” he added.
Koisen’s vision exemplifies the potential of technology and cooperation to overcome long-standing barriers and foster sustained growth.
Papua New Guinea’s financial sector is more developed than that of many smaller Pacific island nations like Fiji, but it faces unique challenges due to its vast geography and population distribution. While PNG has a robust banking industry valued at over K80 billion, with seven commercial banks—including locally owned and foreign institutions—the sector remains limited in reach, with approximately 80% of the population still unbanked. In contrast, Fiji has higher financial inclusion rates and more concentrated banking services due to its smaller size and more urbanized population.
PNG’s financial landscape is further complicated by rugged terrain, security issues, and limited infrastructure, making access to formal financial services difficult outside urban centers. Mobile banking and digital financial services are growing to bridge these gaps, though challenges with connectivity and customer identification persist.
Compared to the broader Asia Pacific region, PNG is still developing its financial sector frameworks, regulatory environments, and digital infrastructure, lagging behind more advanced economies like Australia, New Zealand, and Southeast Asian countries. However, ongoing reforms and innovations, including efforts to increase financial literacy and inclusion, position PNG for gradual but meaningful growth in its financial services over the coming years.
