DIGITAL FINANCIAL INCLUSION

At the forefront therefore of BSP’s financial inclusion strategy is the promotion of an affordable, safe, efficient and convenient means of payment and the creation of a payments ecosystem characterized by an expansive network of access points, ownership of transaction accounts, and the facility to electronically transfer funds from one’s own account to any transaction account.

The ability to use digital channels for payments and remittances, transfer funds electronically to accounts held in other banks and e-money issuers not only facilitates convenience, speed and affordability but also enables muchneeded information which providers can use to provide a broader range of financial services such as credit, investment and insurance.

Toward this end, the BSP has issued a package of policies to develop the envisioned ecosystem.

Recent BSP guidelines on no-frills or basic deposit account (BDA) democratize account ownership which is needed to participate in a digital financial ecosystem. With a low opening deposit requirement (capped at P100), no minimum maintaining balance, and simplified know-your- customer and documentary requirements, the BDA addresses the considerations that usually discourage or prevent low-income earners from opening bank accounts. The bank account can then be used not only to store funds but to make and receive digital payments.

To further expand touch point for financial services, banks can now use third party entities like grocery stores, pharmacies and other retail outlets as cash agents where bank clients can apply for a bank account or loan, make withdrawals and deposits, pay bills and transfer funds. As convenient, non-intimidating access points, cash agents can effectively respond to unique needs of low-income clients and encourage their continued relationship with a bank.

Money service businesses and remittance agents are now covered by enhanced regulations against money laundering, promoting risk management and consumer protection. This provides better service to the many Filipinos who rely on these access points.

Under the guidance and directive of the BSP, banks and e-money issuers launched PESONet and InstaPay — payment schemes that facilitate efficient and interoperable electronic retail fund transfers. With interoperable payment schemes, a user needs to only have one account to do online payments — to pay merchants, billers or send money to friends and family. This spells convenience and affordability.

This package of reforms will revolutionize how each Filipino can access and use financial services in a manner that is convenient and appropriate to their needs and capacities.

CONSUMER PROTECTION

The BSP also implements policies and regulations that protect the rights of financial consumers and ensure the responsible provision of financial services by BSP-supervised financial institutions (BSFIs). These are necessary to empower those with limited knowledge of the formal financial system and to promote financial inclusion.

The BSP requires BSFIs to adhere to the Financial Consumer Protection Framework — standards of conduct, to enable consumers to make informed decisions about their financial products and transactions. The framework covers key areas of disclosure and transparency, protection of client information, fair treatment and effective recourse.

As a second level recourse, the BSP also provides assistance to financial consumers through the Consumer Assistance Mechanism (CAM) facilitating discussions with the relevant BSFIs and ultimately bringing the BSP closer to the Filipinos.

FINANCIAL EDUCATION

Even with the mechanisms in place, BSP reminds that consumer protection is a collective responsibility. Consumers need to exercise their rights and responsibilities, and elevate their financial literacy and financial capability. This is the rationale for the BSP’s Economic and Financial Learning Program (EFLP). The EFLP provides learning programs and leverages on partnerships to reach various audiences like children, college students, the working sector, investors, overseas Filipinos, and selected unbanked sectors to increase financial literacy and strengthen financial capability in the country.

The BSP is also ramping up its financial education campaign called PisoLit through social media, using Facebook as a primary platform for reaching online millennials. Moving forward, the BSP will focus more on partnerships with public

NATIONAL STRATEGY FOR FINANCIAL INCLUSION

The task to achieve financial inclusion toward broad based growth is a significant one that requires multi sectoral collaboration. Toward this end, the BSP led the crafting of a National Strategy for Financial Inclusion which defines the national vision for providing “effective access to a wide range of financial services that contributes to building inclusive growth.” Launched in 2015, the NSFI provides a platform for public and private sector coordination to ensure synergy of efforts to achieve shared objectives.

The BSP is the Chair of the Financial Inclusion Steering Committee (FISC), the governing body comprised of fifteen government agencies that provides strategic direction and guidance in the implementation of the NSFI and created by Executive Order No. 208 dated June 2, 2016.