The Bangko Sentral (BSP) is optimistic that significant improvements in financial inclusion would be achieved in light of recent regulations that are expected to boost account ownership and acceptance of digital payments.
These are the innovations made under the National Retail Payment System (NRPS); the basic deposit account framework (Circular No. 992, 1 February 2018), which meets the need of the unbanked for a low-cost, no-frills deposit account which they can open even without standard identification documents; and the branch-lite regulation (Circular No. 987, 28 December 2017), which gives banks the flexibility to determine the appropriate size and model of a banking office for a specific area or locality based on market needs.
The BSP stated this in its report on the “State of Financial Inclusion in the Philippines 2017” which discussed milestones and trends in financial inclusion in the country.
With the continuous growth of banking offices nationwide, the number of unbanked local government units declined to 554 (33.9% of the total) in 2017 from 582 (35.6%) in 2016, representing a 1.7 percentage points decrease in unbanked areas.
The report also noted that the number of deposit accounts in the country increased by 6.8 % to from 53.5 million in 2016 to 57.1 million in 2017.
As of June 2018, 155 banks (out of 581 head offices) have tapped 1,751 branch-lite units to expand physical outreach in 738 local government units (LGUs), of which 151 LGUs were being served by branch-lite alone.
Meanwhile, the “Year-End Report on BSP’s Financial Inclusion Initiatives” underscored the opportunities presented by the National Strategy for Financial Inclusion (NSFI) in facilitating key multi-partite agreements such as the promotion of financial literacy in schools and access to finance by micro, small, and medium enterprises (MSMEs).
It likewise highlighted the BSP’s contributions to laws that impact on financial inclusion, particularly on the enactment and implementation of the Philippine Identification System Act (R.A. No. 11055) and Personal Property Security Act (R.A. No. 11057).
The two reports continue to mark and measure the country’s journey toward financial inclusion. Building on the gains, the BSP has identified as key priority areas for this year the continued promotion of digitalization to expand access and usage of financial services, as well as strategic partnerships anchored on the NSFI to fully develop the financing ecosystem for agriculture and MSME financing.
The BSP will also continue its collaboration and partnerships on financial education and consumer protection.