Financial Inclusion Reforms in 2021

Asian Development Bank to support Philippine’s Financial Inclusion Reforms:

According to the 2017 Global Findex Survey, the Philippines is the lowest in Southeast Asia for most financial inclusion indicators. According to the survey, only 34% of Filipino adults have an account with a bank or financial institution, compared to 49% in Indonesia and 85% in Malaysia.

 The Philippine government is pursuing an inclusive growth in access to financial services for the country’s non-banking population by implementing reforms to expand the Philippines’ access to financial services. To support the government’s efforts, the Asian Development Bank (ADB) approved a $300 million policy loan on August 21, 2020.

 The aim of the ADB’s Inclusive Financial Development Program – Sub-Programme 2 is to assist the government in achieving the goals of strengthening the institutional and political environment for financial inclusion and the provision of financial services to rural banks and non-residents. banking financial institutions.

 Ahmed M. Saeed, vice president of the ADB, said: “The strategy against poverty in the Philippines aims to provide the Philippines with education, skills, and livelihoods for the poorest 40% of income groups so that they can experience a cycle of poverty. have .can break hard It is important for this approach to ensure that the entire Philippines is part of the financial system.

 By approving this loan, ADB is partnering with the Philippines to implement innovative digital solutions in the financial sector that will significantly contribute to providing access to financial services and products to a large non-banking population.

The following reforms in this financial strategy are:

• Implementation of the National Identification System of the Philippines

• Start financing for the agricultural sector

• Collaboration of public-private partnerships for crop insurance

• Government reforms to include financial education programs in the country’s education curriculum

• Increase the use of digital payments

These reforms will expand credit reporting coverage, promote the use of cloud-based core banking technology in rural banks, and also support the development of Islamic finance in the country.

 Some of the other ADB programs include the $400 million competitive and inclusive agricultural development program launched to help the government increase agricultural productivity and the $500 million global social welfare project launched to provide education and transfers.

Domestic banks and non-bank financial institutions must use smart digital solutions such as digital, internet banking, digital lending, and mobile banking.

 Nelito FincraftTM digital banking solutions provide customers of banks and financial institutions seamless digital banking, with faster and easier access to banking services.

 Using these solutions, financial institutions can increase customer reach, process loans faster, shorten delivery times, compete with new digital entrants, reduce overhead costs, improve operational efficiency and reduce NPAs.

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