ASEAN KEY DESTINATIONS
Strong microfinance in Philippines
At the National Microfinance Stakeholders Summit held April 5, nearly 300 microfinance industry leaders gathered including Rural Bankers Association of the Philippines (RBAP) President Cora Miller.
Microfinance generally involves the provision of credit to poor and low-income households who are normally turned away by banks and have limited access to credit and a secure and safe place to save.
Microfinance loans are often used to expand the activities of the economically active poor while deposit services help poor and low-income households save for the future and build their assets.
RBAP is a staunch advocate of financial inclusion. It launched the Microenterprise Access to Banking Services (MABS) in 1998 with support from the United States Agency for International Development (USAID) with the main goal of expanding access to financial services for Filipinos in the countryside by assisting the rural banking industry with its 2,700 branches and other banking offices to more effectively reach out and service more clients.
The RBAP-MABS program began in Mindanao, where it initially provided training and technical assistance to rural banks but has since expanded to support rural banks nationwide.
The program is now focused on assisting rural banks to expand the range of financial services offered to meet a range of important needs in the countryside. In addition to microfinance loans and deposit services, these new services include micro agri-loan strategies, housing microfinance services, microinsurance, money transfer and micropayment services, as well as mobile phone banking services.
RBAP expects a significant increase in the microfinance services being offered by their member banks especially under the positive direction of the current Aquino administration, which is showing its support for the private sector to expand access to financial services. To counter political patronage of the past, for instance, the Aquino administration indicated plans to revamp pro-private sector microfinance policies.
In EIU’s “Global Microscope on the Microfinance Business Environment,” Philippine microfinance was cited as best in the world in terms of regulatory framework, and second best performing in terms of overall business environment. The recent ranking of the country in the survey was an improvement from 2009 when the Philippines was number three in overall business environment.
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