BSP offers incentives for unbanked areas
Kathleen Martin (The Philippine Star) - January 15, 2015 - 12:00am

MANILA, Philippines - The Bangko Sentral ng Pilipinas dangled yesterday incentives to banks that will set up shops in the country’s unbanked areas.

“The new regulation waives the processing fees for banking offices that will be established in unbanked municipalities to lower the cost of the bank in setting up offices in such areas,” the central bank said in a statement.

The BSP said there are more than 10,000 banking offices in the country but 1,634 cities and municipalities remain unbanked.

“Banking presence tends to be skewed to higher-income and more populated areas considering the cost of setting up banking offices and operating such offices. The countryside is therefore challenged by limited financial services,” the central bank said.

The BSP will post a list of unbanked areas on its website and update this quarterly to better implement the new measures.

At the same time, the BSP has expanded the allowable activities and services that micro-banking offices can provide.

Apart from disbursement and release of proceeds from microfinance loans, MBOs will now be able to service educational loans, health loans, and emergency loans to microfinance clients.

Banks may also apply for an increase in the limit for monthly average daily balance of micro deposit accounts currently set at P40,000, the BSP said.

BSPThere are currently 508 operating MBOs set up in 325 municipalities, of which 62 are served by MBOs alone. The central bank pointed out some municipalities gained access to financial services through MBOs.

“These policy enhancements support the enabling regulatory framework for financial inclusion in the Philippines,” the central bank said.

Earlier, the country has been ranked as third in the world and first in Asia with regard to its financial inclusion initiatives by the Economist Intelligence Unit.

“Despite these significant gains, the BSP acknowledges that much work needs to be done to truly see Filipinos enjoy greater access to financial services. Moving forward, the BSP remains committed to continuously ensuring a supportive policy and regulatory environment for financial inclusion,” the BSP said.

AREAS BANGKO SENTRAL BANK BANKING BSP CENTRAL ECONOMIST INTELLIGENCE UNIT FINANCIAL OFFICES PILIPINAS
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