BDO rural banking arm readies expansion

MANILA, Philippines — The rural banking arm of BDO Unibank Inc. is beefing up its presence nationwide by putting up more branches outside Mindanao.

After getting the green light from the Bangko Sentral ng Pilipinas (BSP), as well as the Securities and Exchange Commission (SEC), to rebrand to BDO Network Bank from One Network Bank, the country’s largest rural bank aims to attain a meaningful nationwide presence.

BDO Network Bank currently has a network of over 150 branches and 90 loan offices nationwide. It provides a wide range of financial products and services including loans, deposits, cash management, remittances, and bills payment in areas considered unserved or underserved by banks.

Just like its parent bank, most BDO Network Bank branches are open on Saturdays. Its clients also enjoy zero interbank charge when withdrawing from a BDO ATM.

The rural bank owned by the family of the late retail and banking magnate Henry Sy continues to address the limited access to capital of micro, small and medium enterprises (MSMEs).

BDO Network Bank president Jesus Antonio Itchon said the rural bank serves a number of MSMEs and individuals who own sari-sari stores, tailor shops and carinderias.

But there are still many who continue to borrow from informal lenders whose effective annual interest rates are too high and repayment is done on a daily basis.

“There is really no way for these people to build up capital under this set-up. At BDO Network Bank, the working capital loan structure has a tenor of 10 months up to three years and the repayment is monthly,” Itchon said.

That is only step one of the process. A key supplement is the financial literacy program that the bank does for its clients.

“It is imperative that they not only learn how to borrow, but that we are able to build a complete banking relationship with them so that they also understand the value of saving and investing for the future. That’s what we instill in them,” Itchon said.

He said many clients of BDO Network Bank remain unaware of the importance of saving a portion of their earnings and allocating another slice to investing.