More Filipinos now have access to financial services, says BSP

MORE Filipinos gained access to financial products and services as the number of local government units across the country that are not served by any financial institution declined in the first half of 2017, the Bangko Sentral ng Pilipinas (BSP) said.

In its latest report on the state of financial inclusion in the country, the central bank said the number of “unbanked” areas declined to 571 LGUs as of end-June 2017 from 589 LGUs in June 2016.

The unbanked areas comprised 34.9 percent, or 1 out of 3, of the 1,634 total LGUs in the country. Considered unbanked are those not served by any bank, but enjoy other financial service access points, and those without any bank nor any kind of access point.

Financial service access points include pawnshops, microfinance institutions, and credit cooperatives. These had wider presence than banks and were the most common financial service providers (FSP) in unbanked areas.

“Only 10 percent of LGUs remained unserved if non-bank FSPs were taken into account,” the central bank said.

As of June 2017, there were 61,000 non-bank FSPs while there were only 11,343 banking offices and 19,500 ATMs (automated teller machines) nationwide.

Among the non-bank FSPs, growth was fastest among mobile money agents, or retail outlets where people can convert cash to electronic money and vice versa.

Banking offices, meanwhile, grew at an average annual rate of 4 percent from 2011 to 2016 while ATMs increased at a faster rate of 12 percent during the same period.

In terms of usage, the BSP report said more Filipinos put their money in banks as there were 44.4 million depositors and 55.3 million accounts with outstanding balance of P11 trillion as of June 2017.

From 2011 to 2016, the number of depositors and deposit accounts increased at an average annual rate of 6 percent and 4 percent, respectively.

However, the central bank said the number of deposit accounts per 10,000 adults in the Philippines was still lower than those in other Southeast Asian countries, except Cambodia, Laos, and Myanmar.

To further reduce the number of unbanked areas in the country, the BSP recently approved regulation allowing the establishment of so-called “branch-lite” units.

The BSP will also come up soon with a policy that will encourage the opening of more new deposit accounts by addressing barriers such as high opening amount requirement, lack of identification documents, high maintaining balance, and the imposition or dormancy charges.

Another initiative to promote financial inclusion is the National Retail Payment System (NRPS) project and the development of a national biometric-based ID system. (Marites Villamor-Ilano/SunStar Philippines)
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