Access to formal financial products and services has improved in the Philippines, the central bank said on Monday, citing a report on the state of financial inclusion.
Data released by the Bangko Sentral ng Pilipinas (BSP) showed the number of unbanked areas in the country improved to 571 local government units (LGUs) or 34.9 percent of the total as of June 2017 from 609 LGUs or 37.3 percent in 2011.
As of end-June 2017, there were 11,343 banking offices in the country.
In 2011 to 2016 banking offices grew at an annual average of 54 percent.
There were 19,500 automated teller machines (ATMs) during the same period, reflecting a growth rate of 12 percent. There were also more than 61,000 non-bank financial services providers (FSP).
“Growth was fastest among mobile money agents which are retail outlets where people can convert cash to electronic money and vice versa,” the BSP said.
“Pawnshops, cooperatives, and microfinance NGOs have a wider presence than banks and are the most common FSPs in unbanked areas. Only 10 percent of LGUs remain unserved if non-bank FSPs are taken into account,” the central bank noted.
BSP Deputy Governor Chuchi Fonacier noted the number of unbanked areas in the Philippines is expected to continue declining since the BSP has relaxed the rules on opening select bank branches.
“We expect that with the policy on ‘branch-lite,’ the unbanked areas will continue to decline,” Fonacier told GMA News Online on Monday.
"Actually, what we like to achieve is that every municipality or city would have at least a branch of a bank. So, with the branch-lite policy, this possibility is not far from reality," she added.
Last month, the policy-setting Monetary Board issued the guidelines allowing banks to put up “branch-lite” units nationwide and offer a range of products and services suited for servicing the needs of the market.
The BSP earlier said such branches would give lenders the flexibility to design the branch, and would be exempted from capital requirements.
“This reform addresses the current situation where there are over 570 cities and municipalities with no banking presence,” it said in a previous advisory.
“With simplified and more flexible provisions, banks will be better able to expand in areas which are unbanked and underserved,” the central bank said — VDS/BM, GMA News