More pawnshops than banks, MFIS last YR–BSP

THERE are now more pawnshops in the Philippines than universal, commercial, thrift, rural and cooperative banks combined, data from the Bangko Sentral ng Pilipinas (BSP) showed.

In a news briefing last Wednesday, Central Bank Governor Benjamin E. Diokno said pawnshops’ offices and branches surpassed the combined 13,044 physical network of universal, commercial, thrift, rural and cooperative banks by end-december 2020.

The BSP said pawnshop head offices and branches reached 14,641, a 5-percent rise from the figure posted a year earlier. The pawn broking industry has a footprint in 1,348 cities and municipalities nationwide.

“Pawnshops play a key role in inclusive finance because of their extensive network that serves as financial access points for low-income individuals, small businesses and social amelioration beneficiaries,” Diokno said.

Because of their ability to reach even the remotest areas of the country, Diokno added that about P6.8 billion in cash aid for 983,505 beneficiaries has been distributed via pawnshops as of enddecember 2020, according to reports by banks and e-money issuers (EMIS) to the BSP.

This includes the social amelioration and Covid-19 adjustment measures programs of the Department of Labor and Employment, the small business wage subsidy from the Social Security System, and the rice farmers financial assistance program of Department of Agriculture.

“With presence in 82 percent of the country’s local government units, pawnshops serve as cash-out agents for banks and EMIS in distributing government financial assistance during the pandemic,” Diokno said.

The governor also said that the industry is showing continuous signs of growth. In the first two months of 2021, the BSP has already issued 31 new pawnshop licenses.

“The pawn broking industry remains optimistic that it will continue to be resilient amid the current crisis. Going in its favor is its continued extensive reach, especially in rural areas, as well as its varied services,” Diokno said.

The 2019 financial inclusion survey report showed that Filipino consumers perceive pawnshops as the most accessible form of financial center, along with automated teller machines and bayad (payment) centers.