The Philippines has improved its score in a global financial inclusion review, the Economist Intelligence Unit (EIU) said, but much still needs to be done to improve the delivery of affordable financial services to the public.
The country, which scored an 81 from 79 last year, retained its ranking of third among the 55 economies reviewed in the EIU’s “Global Microscope 2015” report.
“The Philippines continues to achieve considerable local and global milestones in its pursuit of financial inclusion, owing to the country’s success in terms of the variety of players, which provides a wide range of financial services and products to the public,” the report states.
The Philippines followed first-placed Peru and second-ranked Columbia. Rounding out the top 10 were India, Pakistan, Chile, Tanzania, Bolivia, Mexico and Ghana.
The report, which assessed the regulatory environment for financial inclusion across 12 indicators, underscored efforts made by government agencies in promoting financial inclusion in the Philippines.
In particular, it highlighted the signing last July of the National Strategy for Financial Inclusion (NSFI), which was developed by a committee that included representatives of 13 government agencies.
The NSFI established a framework and action plan where the government and the private sector can take a coordinated and systematic approach for the development of a financial system that is accessible and responsive to the needs of the entire population.
The EIU report also cited the Nationwide Baseline Survey on Financial Inclusion, which was piloted this year and was the first national survey dedicated to collecting demand-side data from the perspective of the actual and potential users of financial services.
“Results from the survey provide a more accurate picture of the state of financial inclusion in the Philippines in terms of access, usage, quality and perceived welfare,” the report said.
Also underscored was the Bangko Sentral ng Pilipinas’ work on the National Retail Payment System, targeted to be operation in two to three years and expected to revolutionize payments in the country, and the now fully operational Credit Information Corp., which was created in 2008 under the Credit Information System Act.
While the Philippines leads in promoting and creating an enabling environment for financial inclusion, the EIU report said there was still much to be done with regard to electronic payment frameworks and non-regulated institutions.
It also noted that only 26 percent of adult Filipinos had savings accounts and only 10.5 percent had cess to formal credit.
“Challenges remain in terms of scaling market innovations, particularly in technology-driven initiatives,” the report states.
There is also a chronic need for financial education and consumer-protection initiatives across both regulated and non-regulated institutions.