ADB approves $300-M loan to boost PHL financial services

THE ASIAN Development Bank is lending $300 million to the government for a program that aims to expand financial services in the country to improve access to credit.
The Inclusive Finance Development Program aims to support the government’s efforts towards a resilient and inclusive financial sector, ADB said in a statement on Wednesday. To be executed by the Finance department, the multilateral lender said the program will help the government improve the policy environment to expand financial services, especially under the National Strategy for Financial Inclusion launched in 2015.
The program will also invest to strengthen the country’s financial infrastructure, including the central bank’s’s national retail payment system. It also aims to launch a national credit registry, establish a collateral registry and reform credit guarantee schemes.
It also looks to help increase the capacity and reach of financial institutions through new technologies, especially rural banks and non-bank entities in unbanked areas like microfinance non-government organizations. It will focus on bringing financial services to entrepreneurs, small businesses, farmers and workers, among others.
“As a result, more people are expected to open bank accounts, save more at financial institutions, and have access to a wider range of other financial products and services,” ADB said.
“The program reflects the strong commitment of the government and ADB to expand financial inclusion in the Philippines and address the challenge of high inequality, which has persisted despite rising and sustained economic growth,” ADB Senior Financial Sector Specialist Kelly Hattel said. “The program builds on important actions taken by the government to strengthen the policy framework for financial inclusion and the infrastructure that supports the delivery of these services.”
Aside from the $300-million ADB loan, the program may be funded by an additional €150 million from the Agence Française de Développement and joint technical assistance, the multilateral bank said.