By Karl Angelo N. Vidal, Reporter
LAND BANK of the Philippines (LANDBANK) is setting its sights on agent banking as it plans to pilot test the model in eight remote areas in the country this year.
LANDBANK President and Chief Executive Officer Cecilia C. Borromeo said in a presentation yesterday that the state-owned lender is eyeing to roll out agent banking in eight more remote areas as part of its thrust to expand its services in rural and unbanked municipalities.
“We only have two (agent banks) under the pilot test stage. We are planning to open eight more this year,” Ms. Borromeo said in an interview on the sidelines of 2019 Retail Banking Forum organized by the Asian Banking & Finance Magazine in Makati City.
In January 2017, the Bangko Sentral ng Pilipinas (BSP) released guidelines allowing lenders to conduct agent banking. It entails a network of outlets, groups or individuals equipped with technology to perform basic banking services such as account opening, cash deposits and withdrawals as well as bills payment.
These agents are typically cash-rich, third-party entities such as convenience stores and pharmacies. Lenders can tap these highly accessible retail outlets located in far-flung areas where bank branches are absent.
“The strategy is to establish partnerships with client cooperatives, associations, small and medium enterprises and even individuals who can serve the public’s basic financial transactions in areas where there is no LANDBANK’s physical presence yet,” Ms. Borromeo said.
She added that the state lender will be “more aggressive” in the coming years if the pilot test is deemed successful.
In a previous interview, former LANDBANK chief Alex V. Buenaventura said the lender aspires to tap 100,000 agents by the time President Rodrigo R. Duterte steps down in 2022.
“All of these (initiatives are) geared toward incorporating larger segment of the country’s population into the financial mainstream, still in line with the government’s thrust to promote greater financial inclusion,” Ms. Borromeo said.
According to the latest Financial Inclusion Survey conducted by the BSP in 2017, only 22.6%, or some 15.8 million Filipino adults, maintain formal bank accounts, citing lack of money and lack of need to have an account as the main reasons.
Apart from tapping the agent banking model, Ms. Borromeo said LANDBANK will put up 10 additional branches this year, which will be scattered nationwide.
It also plans to roll out 300 additional automated teller machines and 40 cash deposit machines.