Philippines wants rural banks to expand operations

Over a third of towns without banking offices.

The Bangko Sentral ng Pilipinas, the central bank, said rural banks also need to expand their operations since only 20% of Filipino households have deposit accounts.

It said rural banks need to scale up their operations and consider programs that will empower them to do so. There were some 2,500 rural bank branches across the Philippines in 2012, or 26% of total banking operations in the Philippines.

A major BSP goal is to make rural banking easily accessible through technological advancements such as mobile phones and Internet connectivity.

Of more than 500 members of the Rural Bankers Association of the Philippines, only 77 have mobile and Internet banking.

There are only 224 rural bank ATMs, of which 145 are in Mindanao, 56 in Luzon, 16 in the Visayas and seven in Metro Manila.

In electronic banking, there are 77 rural banks with 1,171 branches and banking offices offering mobile-phone banking services using Globe Telecom’s GCash and Smart Communication’s Smart Money.

Over three million mobile phone banking transactions valued at more than US$396 million have been facilitated by accredited rural banks.