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With 34M Filipinos remain unbanked, CamSur lawmakers push for Bangko sa Baryo Act

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Lawmakers from Camarines Sur have sought the approval of a measure establishing Bangko sa Baryo in a bid to help Filipinos residing in far-flung areas to have their own bank accounts.

Rep. LRay Villafuerte said the proposed Bangko sa Baryo Act (House Bill 273) will also help President Ferdinand Marcos Jr. achieve his goals of bridging the country’s digital divide and attaining financial inclusion for all Filipinos.

Despite the dramatic increase in online or e-payments in the last two years, Villafuerte said millions of Filipinos still have no bank accounts.

Villafuerte, president of the National Unity Party (NUP), said it is imperative for Congress to address the digital disconnect by passing the appropriate measure.

The Global Findex Database 2021 report of the World Bank bared that some 9.23 million Filipino adults remain unbanked, and that millions of adults continue to receive government payments in cash only.

However, the Bangko Sentral ng Pilipinas (BSP) has a much higher figure of unbanked Filipinos.

BSP’s Financial Inclusion Survey (FIS) showed that 34.2 million or 44% of estimated 77.2 million Filipino adults remain unbanked in 2021. In 2019, the figure is 51.2 million.

The least banked or most financially excluded sectors in 2021 FIS were farmers and agricultural workers (73%), workers in private households (48%), and self-employed individuals (45%).

The same survey showed that 92% of Filipino adults had a mobile phone and 77% had access to the internet yet only 60% of them performed fund transfers, payments, and other online financial transactions.

Aside from Villafuerte, HB 273 was authored by Camarines Sur Representatives Miguel Luis Villafuerte and Tsuyoshi Horibata and Bicol Saro party-list Rep. Nicolas Enciso VIII.

Under the measure, cash agents, who will have corresponding eligibility requirements, shall serve as extensions of the banking systems.

These agents will assist in performing bank services including forwarding account opening applications, cash-in, and cash-out services, and initial customer identity verification, especially for anti-money laundering and combating the financing of terrorism efforts.

The contracting bank shall ensure that the cash agent follows standard bank protocols and exercises due diligence when dealing with customers.

The bill also seeks to increase the financial literacy and capability of an average barrio folk to enable him/her to make sound financial decisions and put his/her hard-earned money to beneficial use.

Villafuerte pointed out that establishing a banking presence in far-flung areas would address the result of the 2021 FIS showing that only six out of 10 Filipinos have demonstrated a change in financial behavior amid the COVID-19 pandemic.

Aside from making transactions with the government easier and cheaper, Villafuerte said digitalization will also make the country more investor-friendly since it will further improve the ease of doing business, and minimize corruption by limiting face-to-face interactions.

He said that providing unbanked Filipinos with access to useful and affordable financial products and services that meet their needs will be “a key enabler to reducing poverty and boosting prosperity.”