THE Rural Bankers Association of the Philippines (RBAP) has urged the lawmakers to amend some provisions in the Rural Bank Act of 1992 to better serve their banks, citing the alarming number of rural banks being closed in the country.
Dr. Armando Bonifacio, RBAP president, said that from 2009, there are 139 rural banks that were closed, where 22 of which are the only banks in their areas, resulting in unbanked municipalities.
Bonifacio said there is a need to promote comprehensive financial development of rural banks to achieve government financial inclusion.
“Rural banks are at the forefront because they are serving countryside. But we found out that there are some provisions in the banking act that are not implemented,” Bonifacio told reporters during a meeting in Dulag, Leyte on Monday, February 25.
Bonifacio said that if rural banks are facing problems like on their capitalization and its liquidity, the government financial institutions like Development Bank of the Philippines (DBP) and Land Bank of the Philippines (LBP) “should infuse capital” until they can recover.
Government regulators should not be quick in closing rural banks and have them under stringent regulations like other big commercial banks, he added.
According to Bonifacio, the government has no distinctions in imposing its regulations between rural banks and big commercial banks.
Since the 1950s, when rural banks started to flourish, Bonifacio said that there were about 1, 800 banks in the country.
Yet today, the number rural banks has been reduced to around 460, he said.
RBAP Director-Atty. Mary Ann Topaci said their fight for the revision of Rural Bank Act of 1992 is not only for the rural bank but also for the people they serve.
She also cited on the renaming of rural bank act into a community bank, while urging the government to finance and capacitate them to become “robust,” noting that they are in the forefront in serving the banking needs of the marginalized sector in the community like the fisherfolk, farmers, and other small entrepreneurs.
The group said that if the government will “kill” rural banks, the people in the rural areas will have nowhere else to go but to the “5-6” money-lending business and another unscrupulous financing schemes.
“Time changes, and we have to change,” added Natividad Yu, the chairman of the Rural Bank of Dulag.
She added that it is high time that the government will revise the banking act to also benefit the rural banks.
Meanwhile, Leyte Second District Representative Henry Ong, the chairman of the House committee on banks and financial intermediaries, said he will look into the appeal of the rural bank sector.
“We need to study the issue of our rural banks and attune it to their needs, especially that countryside development starts with them,” said Ong, who joined the around 20 bankers from across the country during the meeting which was initiated by the Leyte-Samar-Biliran Federation of Rural Banks and its President Anacleta Aboyme. (SunStar Philippines)