Bangko Sentral ng Pilipinas to develop a digital finance ecosystem in pursuit of financial inclusion & stability
“Financial inclusion is about providing all Filipinos access to affordable and client-centered financial services that can help them build a better life for themselves and their families,” as described in the Financial Inclusion Initiatives 2017 report, produced by Bangko Sentral ng Pilipinas (BSP).
Developing a digital finance ecosystem
One of the founding members of the AFI network, BSP has been instrumental in nurturing an conducive environment for the delivery of financial products, specifically for the low income and vulnerable segments of society. Turning microfinance into a banking activity that allows 163 banks — mostly rural banks in the countryside — to serve more than 1.71 million microentrepreneurs, BSP is promoting sustainable financial inclusion through market-based solutions.
BSP is setting its sights on digital innovations as a catalyst and strategic enabler for financial inclusion, while building on microfinance regulations that have also facilitated delivery of financial products such as microdeposit and microinsurance.
“Digital technology can significantly reduce transaction costs and expand reach — making it possible and even compelling for banks and other financial institutions to serve the hugely untapped low–income market.”
With financial inclusion strengthening financial stability, the BSP’s goal is to develop a secure and sustainable digital finance ecosystem that supports the diverse needs of all users in a convenient and affordable manner. For the service providers, whether new or incumbent, this ecosystem offers a wider client base, diversified revenue sources and secure new growth opportunities. To BSP, this illustrates how the pursuit of financial inclusion can support financial stability objectives.
Participating on a global platform
BSP actively participates in AFI’s capacity building programs and working group meetings, looking at the critical aspects of financial inclusion including digital financial services, SME finance, consumer protection, global standards proportionality, national strategy, data and measurement. Through these engagements, BSP has been able to tap external resources for the conduct of valuable deep-dives and researches, knowledge exchange and technical assistance programs.
Under the chairmanship of the Philippines from September 2016 – September 2017, the Financial Inclusion Data Working Group (FIDWG) has continued its work on sex-disaggregated data to support women’s financial inclusion and created new work streams on monitoring and evaluation of national financial inclusion strategies, supply-side data collection, and needs-based approach in financial inclusion measurement, in response to emerging trends in financial inclusion data.
During the AFI Awards at the 2017 Global Policy Forum, BSP Governor, Amando M. Tetangco, Jr. received a Leadership Award as the former Chair of the AFI Steering Committee. BSP won the Peer Review Award in recognition of its contribution in reviewing the financial inclusion policies, national strategies, surveys and reports of other AFI member countries.
Did you know that the Philippines has the largest gender gap in favor of women? Discover how Bangko Sentral ng Pilipinas (BSP) approaching the reverse gender gap with a tailored financial system.