Financial literacy helps policy actions


Financially literate and empowered stakeholders serve as effective partners in policy implementation particularly for the Bangko Sentral ng Pilipinas, according to BSP Governor Amando Tetangco Jr.

In a speech, Tetangco said that the BSP’s financial inclusion program not only preserves the purchasing power of the Filipinos, but also help empower the broader citizenry to self-sufficiency.

The BSP governor noted that the central bank’s financial inclusion framework is built on three areas: broad access to appropriate credit at reasonable rates through responsible and proportionate regulation that encourages market innovation; timely and relevant economic and financial learning; and well founded financial consumer protection.

He also reported that the central bank’s financial inclusion efforts have been recognized internationally for having the best policy and regulatory environment for the development of microfinance sector.

“Key to the retention of the top post is BSP’s enabling role in advancing mobile access to bank accounts, agent relationships for cross-selling of micro-insurance products and its current initiatives on improving its financial inclusion data framework,” he said.

Tetangco also noted other policy issuances this year, which include procedural improvements in product approvals of housing microfinance and micro-agri loans to simplify the process by which banks can offer innovative products, and the guidelines on management of technology risks as well as the liberalization of Know Your Customer regulations under specific parameters.

“Our polices on simplified or scaled down branches called microbanking offices [MBOs] have enabled banks to have a presence in areas that were previously unbanked,” he said.

The central bank governor reported that these MBOs are now serving 50 municipalities or an increase of 35 percent compared to only 37 municipalities in 2011.

Furthermore, Tetangco said that the BSP continued to leverage off mobile technology by enabling alternative financial service providers, or FSPs as effective touch points to banking services.

He said that FSPs, including pawnshops, remittance and e-money agents, which tend to be available even in areas with small population and have high incidence of poverty, now total over 46,200 from about 38,400 in 2011, or a growth rate of 20 percent.

“If we consider only banks [including MBOs]37 percent of municipalities would be without such presence. But if we now include FSPs, only 13.2 percent of municipalities would not have any form of access to financial services,” he said.

Gaining ground
Tetangco also reported that in terms of financial learning program, the BSP continue to gain ground since the program was revitalized in 2008, noting various domestic and international roadshows and financial expos, and advocacy programs for the youth.

This year, the BSP governor said that the monetary authority plan to leverage the program to be able to reach out to more sectors and regions across the country.

“Finally, we have further strengthened consumer protection by formalizing a consumer protection framework against which banks must measure their own efforts,” he said.


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