MANILA, (DWDD) — The Economist Intelligence Unit (EIU) names the Philippines as the top country in East and South Asia and the third in the world, with the most conducive environment for financial inclusion.
In EIU’s maiden edition of the “Global Microscope on the Enabling Environment for Financial Inclusion”, the Philippines together with 54 other countries around the world, were assessed using 12 indicators that measure government support for financial inclusion; regulatory and supervisory capacity for financial inclusion; the effectiveness of regulations to promote inclusive financial services like savings, credit, microinsurance, and electronic payments; ease of setting up branches and agents that provide financial services; as well as the existence of credit reporting systems, market conduct rules, and grievance and dispute resolution mechanisms that protect financial consumers. With a score of 79 out of 100, the Philippines bested 11 other countries in Asia and followed Peru and Columbia at the top of the global ranking. The top 3 countries, on account of their strong leadership and institutional depth, scored well above the 4th country Chile which garnered 66 points.
From 2009 to 2013, the EIU Global Microscope focused on assessing the Microfinance Business Environment of countries. In all these years, the Philippines was consistently ranked as having one of the best regulatory environments for microfinance. In the 2014 Global Microscope, the EIU notes that results cannot be directly compared with past rankings due to substantial changes in the assessment methodology. However, the EIU acknowledges that “Under any (methodological) framework, the Philippines will score well, because it benefits from having a highly capable regulator, optimal credit regulation and effective dispute resolution”. The Philippines received a score of 76 for 8 out of the 12 indicators.
The EIU cites the Bangko Sentral ng Pilipinas (BSP) as “the first central bank in the world” to establish an office, the Inclusive Finance Advocacy Staff, dedicated to financial inclusion. It also recognizes the leadership of Governor Amando M. Tetangco Jr., as head of the BSP Inclusive Finance Steering Committee, in championing the crafting of a national strategy for financial inclusion.
For the past 15 years, the BSP has devoted significant efforts to establish an enabling policy and regulatory environment for financial inclusion. In 2000, the BSP initially focused on the safe and sound provision of microfinance services by the banking sector to traditionally unbanked microentrepreneurs. The BSP has since committed to pursue financial inclusion, a state where there is effective access to a wide range of financial services for all Filipinos. It has issued regulations that support expanded financial access, while preserving financial stability and integrity, deepening financial education and ensuring consumer protection. BSP regulations allow market innovation, pioneering products, and new market entrants including non-bank providers, to target financially excluded segments of the population with affordable and accessible financial services. At the same time, these regulations ensure that providers and products are safe, sound, and responsive to diverse consumer needs.