The number of banking deposit accounts in the Philippines has grown to 46.9 million as of June 2014 from 39.7 million two years earlier, reflecting an improvement in what the central bank calls financial inclusion in the country.
“In what could very well be one of the most significant gains we have achieved, we have seen a sizeable increase in the number of deposit account holders,” Bangko Sentral ng Pilipinas (BSP) Governor Amando Tetangco Jr. said during the 7th General Membership Meeting of the Shareholders’ Association of the Philippines on Thursday.
Tetangco said what is most notable is that nearly 6.6 million of the increase of 7.2 million are those with balances of less than P100,000.
Fewer unbanked areas
Tetangco also reported that there are now fewer cities and municipalities in the country that are considered unbanked.
At the end of 2012, about 37 percent of cities/municipalities had no banking presence either in the form of banks or micro banking offices.
However, taking into account the increased presence of other financial service providers like automated teller machines, e-money agents, pawnshops, savings and loan associations, remittance agents and money changers, the percentage of cities/municipalities that remains unserved is just 12.6 percent, he said.
“These are developments that do not normally catch the headlines or even the business pages. But they are nonetheless tangible gains which we need to sustain and further enhance,” he stated.
To bring more savers into the formal financial system, Tetangco said the central bank is focused on three important agendas: broadening stakeholder access; improving the mix of financial products; and leveraging technology.
He said that the BSP broadens stakeholders’ access specifically by rationalizing the requirements for establishing financial access points.
“For example, access is not limited to full banking offices or brick and mortar establishments . . . we now have micro-banking offices and financial service providers,” the BSP governor said.
Meanwhile, the central bank improves the mix of financial products through the application of proportionate regulation such as allowing micro-insurance, micro-agriloans, relaxed disclosure and other requirements, and partnering with industry associations to come up with new products such as the Kiddy Account Program, he said.
The BSP is also leveraging technology to help create more financial access points and products such as mobile and internet banking.
“Such efforts are a calibrated intervention. We believe that financial markets should be made strong not because they are the exclusive domain of those who can save.
Rather, their strength must rest on their ability to be responsive to the needs of stakeholders . . . all stakeholders,” Tetangco concluded.