The Philippines remains one of the top countries promoting financial inclusion—ranking fifth worldwide and first in Asia together with India—based on the Economist Intelligence Unit’s Global Microscope 2019 study, according to the central bank.
The Bangko Sentral ng Pilipinas said the country continued its “exceptional performance” in the report’s five standard categories, which consisted of government stability and support; stability and integrity; products and outlets; consumer protection, and infrastructure.
“The country also retained its top standing in credit portfolios for middle- and low-income customers, market entry and ongoing requirements for banks,” it said in a statement.
Focusing on the enabling environment and expansion of digital financial services, the Global Microscope 2019 recognized the country’s recent efforts in promoting digital financial inclusion and financial literacy.
The report cited the continued implementation of the National Strategy for Financial Inclusion under the guidance of the inter-agency Financial Inclusion Steering Committee. It highlighted recent initiatives, among them the launch of the national digital ID system, one-stop shop program for online government services and creation of the BSP’s Financial Technology Sub-Sector, a supporting unit oriented toward digital financial technology for the underserved.
The report also cited areas for further development for the Philippines, in which efforts were already being made to address concerns specifically posed by cyber-security, connectivity and frameworks for emerging services.
It noted that interoperability in retail payments remained hindered by limited industry participation and transaction costs, adding that the supervision of microfinance institutions and non-banks as well as dispute resolution mechanisms for government payments likewise “require enhancement.”
The BSP noted that, while the Philippines was one of only four countries where women have better access to digital financial than men, the report noted that the country lacked gender-based goals.
“Legal and regulatory efforts have been made to bolster consumer protection mechanisms and safeguard public welfare in response to these challenges,” the central bank said.
The findings of the Global Microscope 2019 were “positive overall” owing to the improved global enabling environment for financial inclusion.
Countries have been increasingly integrating digital approaches alongside the implementation of financial inclusion strategies. The increased adoption of relevant frameworks would encourage the entry of more innovators and external players such as fintech firms.
“The results of the Global Microscope will (help) the BSP’s efforts toward achieving financial inclusion and its vision of bringing itself closer to the people,” the central bank said.
A leading publication on financial inclusion, the Global Microscope is a yearly assessment of 55 countries on their respective initiatives and provides information on global trends and issues in financial inclusion.