October 12, 2019
MANY Filipinos are still being left behind in terms of financial services despite technological advancements in the banking and non-banking sector, according to the chief of the Bangko Sentral ng Pilipinas (BSP).
In his keynote speech at the 2019 Finex (Financial Executives Institute of the Philippines) Conference, titled “Riding on the Opportunities on the Next Digital Wave,” in Bonifacio Global City, Taguig City on Friday, BSP Governor Benjamin Diokno said that “despite favorable developments due to technology, many challenges persist,” as “there is uneven access” to these innovations.
The “people who should benefit the most from new technologies are the ones who are still left behind,” he added.
Citing the results of the central bank’s 2017 Financial Inclusion Survey, Diokno said only 23 percent of Filipino adults have a formal account and only 48 percent of adults save. However, only seven out of 10 savers keep their savings at home.
Also, of the 22 percent of Filipino adults who avail themselves of loans, four in 10 do so through informal sources.
“As such, it is necessary to bring the unserved and underserved into the national economy,” Diokno said.
The BSP is mandated to elevate financial inclusion and its complementary objectives of financial literacy and consumer protection from advocacies to an institutional imperative under its amended charter, according to him.
“The pursuit of financial inclusion requires an openness to all possible transformative solutions and impactful innovations, such as digital technology, new business models and cross-sector
collaboration,” Diokno said.
With this, he said the central bank was optimizing the applications of technology by directing focus on sectors including agriculture, as well as countryside development.
“In brief, our goal by 2023 is to ensure that at least 70 percent of adult Filipinos will have access to formal financial services,” the Bangko Sentral governor said.
“Needless to say that digital technology can massively help our financial inclusion agenda,” he added.
That said, Diokno said the BSP issued several policy issuances in 2016 that included guidelines and incentives for banks to offer basic deposit accounts with no maintaining balance and an opening deposit not exceeding P100.
Regulators also issued the National Retail Payment System framework, which anchored the launch of PESONet and Instapay, to allow faster, safer and more convenient electronic fund transfers between accounts held in any participating bank or electronic money issuer.
Diokno said the Bangko Sentral issued the cash agent regulation that enabled banks to use convenience stores, pharmacies, pawnshops and other retail outlets as low-cost and non-intimidating service points, where clients can open an account, make deposits and withdrawals, pay bills, and perform other transactions.
Lastly, the central bank head urged the private sector to find ways on how it can contribute to financial inclusion.|
“Financial inclusion is our shared social mandate. And there is never a better time to act than now. We all have a stake in the future of our country,” he said.
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