initiatives are being pushed by the DOF that will enable the rural banking
system to meet the challenge of reducing the number of unbanked Filipinos in
The Secured Transactions Reform
Bill also known as the Financial Inclusion Bill
A fully automated credit
Consolidation Program for Rural
The reality that
a majority of Filipinos remain unbanked even when economy is growing at a fast
pace was described by Finance Secretary Carlos Dominguez III as “not a good
indicator,” because this means they have neither access to financial services
nor ways to participate in investments.
Finance Secretary Dominguez is
hoping that rural bankers would be at the forefront of national efforts to
adapt to technological change, as this development would “immeasurably
contribute to the dramatic transformation of our economy.”
changes will revolutionise the way we do banking. I urge you to embrace the
changes that are forthcoming. This revolution in the financial sector will
power our economic growth and help us be competitive into the future,” Secretary Dominguez
encouraged members of the Rural Bankers Association of
the Philippines (RBAP) at the organisation’s 65th national convention held
at the SMX Convention Centre.
The DOF is
pushing the congressional approval of the Secured Transactions Reform Bill, or
the Financial Inclusion Bill, which would increase the use of technology in
rural lending. It would also enable farmers and countryside entrepreneurs to
tap their warehouse receipts, farm equipment and other forms of property as
collateral to access credit.
This bill will enable
micro, small and medium enterprises (MSMEs) and millions of unbanked Filipinos
to take advantage of the economy’s rapid growth, Secretary Dominguez said
The DOF is also
pushing the development of a fully automated credit information system that
will equip financial institutions with a modern centralised credit registry
under the Credit Information Corporation in order to facilitate lending
The system is almost
fully established and undergoing a series of final tests.
Moreover, the Bangko Sentral ng Pilipinas (BSP) has
reactivated its Consolidation Program for Rural Banks to encourage mergers and
consolidation of rural banks and further strengthen the country’s banking
“I encourage all
of you to take a closer look at this program, appreciate the synergies and
economies of scale that integration will foster. It will make possible the most
efficient use of the common infrastructure, systems, and resources of the
smaller banks,” Secretary Dominguez explained during the event.
also urged rural bankers to familiarise themselves with the recent advances in financial
technology (FinTech) while the government rushes the completion of the digital
backbone for processing payments in real time.
“The success in
achieving the mission of financial inclusion is eminently measurable. If we are
able to bring down the number of the unbanked over the next few years, the
banking system should have contributed towards building a more inclusive
economy,” he said.
He pointed out
that the Philippines is now one of the best performing economies in Asia,
second only to Vietnam’s 7.4% and matching China’s growth rate of 6.8% in the first quarter of this year.
The DOF also
wants the Congress to pass a bill that will shift rice trading from
quantitative restrictions to tariffs in order to stabilise the supply and lower
the retail price of rice, as well as approve legislation implementing a
national ID system to enhance the efficiency of transactions in the economy.