BSP’s new financial inclusion agenda approved

Published June 27, 2022, 3:06 PM

by Lee C. Chipongian

Outgoing President Rodrigo Duterte has approved the Bangko Sentral ng Pilipinas’ (BSP) memorandum circular on the whole-of-government approach to promote the updated six-year National Strategy for Financial Inclusion (NSFI).

BSP Governor Benjamin E. Diokno on Monday, June 27, lauded Malacanang’s “valuable support” to the NSFI. “The signing of this circular demonstrates the collective commitment in the government to accelerate financial inclusion in the country,” he said.

BSP Governor Benjamin E. Diokno

Diokno, who is incoming finance secretary in the next administration, said financial inclusion is a whole-of-nation undertaking.

“It is imperative for all of us, government agencies, regional bodies, LGUs (local government units), and the private sector, to work together in ensuring all Filipinos can access welfare-enhancing financial services in line with their needs and capabilities,” he said.

The new circular directs all government agencies to incorporate the NSFI into all its relevant priority initiatives in the agency work programs, policies and budgets.

All Regional Development Councils and the Local Development Councils are also encouraged to adopt financial inclusion objectives, targets and programs, in line with the NSFI, in their respective plans.

LGUs are likewise directed to implement financial inclusion in their jurisdictions and in their capacity development programs, provincial development and physical framework plan, said the BSP.

The Office of the President issued Memorandum Circular No. 97 last week, June 23. It institutionalizes the whole-of-government support for the implementation of the NSFI 2022-2028 and the adoption of financial inclusion as a development agenda at both the national and subnational levels.

The BSP launched NSFI 2022-2028 in January as a shared blueprint for a broad-based growth and financial resilience, said the BSP. The NSFI, which was an updated version of its original 2016 agenda, also embraced the Philippine Development Plan and the AmBisyon Natin 2040.

Specifically, the new NSFI as clear-cut focus on micro, small and medium enterprises (MSMEs), start-ups, and agriculture financing. The MSME sector with 63 percent of total employment is a major source of livelihood for a large population of Filipinos.

The updated NSFI’s primary objective is financial resilience since many Filipinos, especially the poor, are facing increased vulnerabilities from the health crisis and climate change.

Diokno has said that the NSFI has four desired outcomes and one of them is increased access to finance for MSMEs, startups, and the agriculture sector. Other hoped-for results for the new strategy are: reduced disparities in financial inclusion; improved financial health and resilience; and a more financially capable and empowered consumers.

Diokno, who chairs the Financial Inclusion Steering Committee (FISC) which is the interagency governing body that leads the collaborative approach in implementing the NSFI, said the FISC will organize working groups with members coming from the government such as regulators, policymakers and local government associations.

Banks and non-bank financial institutions, telecommunications, internet service providers and similar sectors, and their industry associations are also part of the collaborative approach. Consumers as represented by consumer groups, civil society organizations, basic sectors and the transacting public are also crucial in the success of the new NSFI’s working groups, with supporting institutions such as donors, development partners, academe, and think tanks, said Diokno.