Basic bank accounts ballooned in third quarter 2023

MANILA, Philippines — More Filipinos opened low-cost basic deposit accounts (BDAs) in the third quarter of 2023, marking a significant progress in attaining the dream of Bangko Sentral ng Pilipinas to increase financial inclusion in the country.

Latest data from the BSP showed a 175-percent surge in the number of BDAs, reaching 23.6 million in the July-September quarter of last year, from 8.6 million in the same period in 2022.

At the same time, the total value of BDA deposits amounted to P36.6 billion, close to seven and a half times the previous P4.9 billion.

Filipinos can easily open BDAs, introduced in 2018, in banks for a minimal fee of not more than P100. BDAs have no maintaining balance and dormancy charges.

READ: Basic deposit account adoption surges to 22M

These low-cost and no-frills accounts are intended to foster greater financial inclusion by catering to the needs of Filipinos who are not yet using the banking system, especially those in the low-income sector.

Financial inclusion

Through BDAs, more Filipinos can—through banks that do offer this product—open a savings account that earns interest and is insured by Philippine Deposit Insurance Corp.

Banks that offer BDAs call it by different names other than the generic “basic deposit account.”

State-run universal bank Land Bank of the Philippines has “Landbank Piso,” which is short for Perang Inimpok Savings Option. Robinsons Bank Corp., a commercial bank, has “Simple Savings.”

BPI Direct BanKO Inc., a thrift bank, calls it “PondoKo.” Silahis Bank Inc., a rural bank in Bulacan, has “Munting Yaman.”

However, data from the BSP showed the number of banks that offer BDAs decreased to 156 in the third quarter of 2023, from 158 in the preceding three months.

Tamma Febrian, director of the financial institutions team at Fitch Ratings in Singapore, told the Inquirer the decline in number of participating banks could be due to the closure of various thrift banks in the country.