THE Bangko Sentral ng Pilipinas (BSP) reported that local government units (LGUs) that are unbanked has dropped to 571 as of June 2017 from 589 in the same period in 2016.

According to BSP's report on the state of financial inclusion released Monday, 24 LGUs gained banking presence with the establishment of micro-banking offices (MBO), other banking offices (OBO), and regular branches.

However, as of June 2017, there were also six LGUS that were unbanked or lost banking presence due to closure of the only banking office, mostly OBO, located in the area. Hence, the current tally of 571 unbanked areas.

"On a positive note, all of them (six unbanked areas) have access to other financial service access points, mostly pawnshops, cooperatives, and microfinance non-goverment organizations," BSP said.

On the unbanked LGUs in 2017, Canlaon City in Negros Oriental was the only city that lost banking presence.

The Central Bank also reported that out of 1,634 local government units or LGUs (cities and municipalities), the number of unbanked areas declined to 571 LGUs in June 2017 from 609 LGUs in the same period in 2011.

Meanwhile, BSP also reported that as of June 2017, there were 11,343 banking offices and 19,500 ATMs in the country.

"Banking offices grew at an average annual rate of 4% in the past six years (2011 to 2016). ATMs increased at a faster rate of 12% during the same period," BSP said.

In a statement, BSP said that building on these modest gains, the agency has issued new policies which promise greater financial inclusion.

"One of them is the recently approved regulation allowing banks to put up 'branch-lite' units to further expand the physical reach of banking services especially to unbanked and underserved LGUs," BSP said.

It added that it is also finalizing the policy framework that will encourage banks to offer a “basic deposit account” that will address the usual barriers in account opening such as high opening amount and maintaining balance, dormancy charges, and lack of identity documents. (RJL/SunStar Davao)