Almost 90 percent of cities and municipalities in the country have been reached by financial services as of last year, the central bank said, citing its progress in financial inclusion.
“We are proud to say that by the end of 2016, close to 90 percent of municipalities and cities in the Philippines already have some form of access to financial services,” outgoing Bangko Sentral ng Pilipinas (BSP) Governor Amando Tetangco Jr. said in a speech delivered by Monetary Board member Valentin Araneta during the opening ceremony of the 28th East Asian Seminar on Economics in Pasay City on Thursday.
Tetangco said persistent inequality has spurred the central bank’s continuing desire and efforts to promote financial inclusion.
“To help alleviate poverty in the country, we have put in place a solid regulatory framework that facilitates access to credit and other financial services for the unbanked while ensuring the stability of the financial system as a whole,” he said.
Improving access to payments facilities and formal credit lines could make a positive difference in people’s lives, especially the poor.
“Research findings have bolstered the emerging consensus that greater financial inclusion generally contributes to achieving inclusive and durable growth and to promote financial stability. All of these insights strengthen the BSP conviction that our financial inclusion initiatives are a worthwhile endeavor allowing us to deliver on our mission to help bring about a higher quality of life for all Filipinos,” he said.
In recent years, he said, the Bangko Sentral had allowed the establishment of micro-banking offices (MBOS) and alternative financial service providers in the underserved markets in the country.
Last month, the central bank said it will further liberalize the functionality of MBOs to operate as light branch with more functions beyond microlending.
MBOs provide a specified range of activities and services such as micro-deposits, micro-loans, microinsurance, foreign currency, bills payments, government pay-outs, and e-money conversion.
The BSP plans to allow MBOs to stand alone and encompass the function of opening micro-deposit accounts for small savers.
A micro-deposit account has a required maintaining balance of not more than P100, with an average daily balance not exceeding P40,000. The deposit account does not have dormancy charges.
In its latest report on the state of financial inclusion in the Philippines, the Bangko Sentral said the growing number of MBOs has contributed significantly to better access and use of financial services in the Philippines.
Regular bank branches continue to rise in number but concentrated in Metro Manila. In that sense, MBOs contributed more to financial inclusion by extending the reach of financial services to underserved and unserved areas, it said.
Most MBOs are located in Calabarzon (Cavite, Laguna, Batangas, Rizal and Quezon), Bicol, Western Visayas and Mimaropa (Mindoro, Marinduque, Romblon and Palawan).
“Most municipalities that were previously unbanked are now enjoying access to banking services because of MBOs,” according to the central bank.
As of June 2016—the latest available data—there were 617 MBOs, up 93 percent from 320 as of end-June 2012.
The number of local governments with MBOs grew by 105 percent to 393 in June 2016 from 192 local governments in June 2012. To date, 75 municipalities are being served by MBOs alone.
MBOs increased by 18 percent on average year-on-year, which is faster than the growth of other types of banking offices (4 percent) and automated teller machines (13 percent).
Source: https://www.manilatimes.net/financial-inclusion-reaches-nearly-90-target-bsp/335718/
