PHL falls to 5th place in global financial inclusion rankings

The Philippines fell one notch in the global financial inclusion rankings but remains in the top five, according to global advisory group Economist Intelligence Unit's (EIU) survey.

The country ranked fifth among 55 countries in the EIU's Global Microscope report for this year, tied with India, making them the two highest-ranking Asian countries on the list.

The EIU—the research and analysis arm of the Economist Group—defines financial inclusion as the enabling environment for financial access, including digital financial services.

Both the Philippines and India's scores slipped to 71, versus their previous score of 72 in 2018 when they were tied in the fourth spot.

"The Philippines has increased its focus on digital financial inclusion, with the launch of a biometric national identification system and a programme to provide a one-stop-shop for online government services," the EIU report read.

"Efforts are being made to increase financial and digital literacy, but they lack gender goals," it added.

The Philippine Statistics Authority (PSA) in September said it is on track to have the national identification system in full swing by the middle of 2020, following the pilot run this year.

The Bangko Sentral ng Pilipinas (BSP) already previously said that the implementation of the national identification system would boost financial inclusion in the country, as more unbanked individuals will be able to open accounts with local banks.

"Bangko Sentral ng Pilipinas has created a support institution to focus on digital financial technology for reaching the underserved," said the EIU.

Just last month, the BSP launched the Government e-Payments (EGov Pay) Facility which enables government agencies to accept digital payments, and the QRPh, the national standard for quick response codes across the Philippines which will integrate all digital payment solutions.

Still, the EIU noted that this may still be improved as more institutions participate in such initiatives.

"Interoperability in retail payments is still constrained by a limited number of participating institutions and high transaction costs," it said.

"The supervision of non-banks and MFIs (microfinance institutions) needs strengthening as do dispute resolution mechanisms for government payments," the report added. — BM, GMA News