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PH tops in financial inclusion

The Philippines gained the biggest improvement in overall score in digital and  financial inclusion in 2016.

This is according to the Brookings Institution, one of the world’s oldest think tanks, which recently released the 2016 Financial and Digital Inclusion Project Report: Advancing Equitable Financial Ecosystems (Report).

The 2016 Report highlighted that the Philippines increased its overall score by eight percentage points compared to its score in the 2015 Report. This upsurge was attributed to the launch of the Philippine National Strategy for Financial Inclusion (NSFI); strong performance in terms of mobile capacity, as measured through smartphone penetration; and highest rate of adoption of mobile money accounts among the South East Asian countries included in the Report.

In 2016, Brookings increased its sample to 26 geographically, economically and politically diverse countries, from just 21 in 2015.
These countries were assessed using varied criteria classified under four general dimensions: Country Commitment1 , Mobile Capacity3 Capacity2 Brookings likewise expanded the scoring criteria to include existence of a consumer protection framework for financial services (under Country Commitment), smartphone adoption and availability of merchant payments via mobile money (under Mobile Capacity) and frequency of account usage (under Adoption).
The Philippines garnered the highest scores in Country Commitment (100) and Regulatory Environment (100), also achieved a high score in Mobile Capacity (94) and a more modest one in Adoption (42). All these scores represent positive improvements from 2015 levels.
The 2016 Report acknowledges the work of the Bangko Sentral ng Pilipinas (BSP) in hepherding implementation of the Philippine NSFI and advancing the formalization of the National level participation in international financial inclusion organizations; and existence of a financial inclusion strategy, quantifiable targets, government-supported demand side survey, and dedicated financial inclusion body within the public sector.
Agent banking, mobile network operator-led financial service deployments, e-money regulations, mobile money platform inter-operability, account access and usage, and cash-in/cash-out at agent locations.
3 Market penetration (unique subscribers); 3G mobile coverage by population; and availability of bill payments and international remittances via mobile money.
Formal formal financial institutions’ account penetration among lower-income adults and women; mobile money account penetration among these same target groups; borrowing and saving at a financial institution; mobile phone usage in salary distribution (among wage-earners) and utility payments (among adults making regular bill/utility payments); debit card use; and percentage of adults using online bill payments and purchases.