Poor access behind low loan uptake in PHL–bank exec

By Cai U. Ordinario @caiordinario

B PI Executive Vice President

Ginbee Go told reporters on Tuesday that while Filipinos need loans, few of them are able to go to banks despite the strong push for financial inclusion.

G o said this requires banks like

BPI to work closely with various institutions such as the Bangko Sentral ng Pilipinas (BSP) to reduce the requirements for obtaining a loan as well as the Philippine Statistics Authority (PSA) with regard to the full use of the national ID.

To be more accurate, if you compare the Philippines to other countries, the level of debt in the country is still very low, which means we’re not extending enough credit to people who need it still.

So part of financial inclusion is to make credit accessible,” Go said.

T his is particularly seen in major purchases such as buying homes.

Based on latest PSA data, among the 9.75 million households who purchased homes, the majority or 85.4 percent used their own resources or interest-free loans from relatives/friends.

L ess than 10 percent of these households obtained financing from the National Housing Authority (NHA), Pagtutulungan sa

Kinabukasan: Ikaw, Bangko, Industriya at Gobyerno (Pag-IBIG), Government Service Insurance System (GSIS), Social Security System (SSS), Development Bank of the

Philippines (DBP), and others.

A n even smaller percentage, at only 5 percent, acquired financing through private banks, foundations, and cooperatives while 4.3 percent acquired loans with interest from private persons to make their big-ticket purchases.

“ We have to continuously make sure that within the banks, we are able to better understand the use of transactional data, to be able to have a better way of assessing the capability of the client over and beyond the usual ITR (income tax return) because some don’t have ITR, including alternative income documents such as making use of payslips, even data such as social media,” Go explained.

Beyond digital EFFORT to better reach customers, especially Generation Z and the Millennials who are considered as digital natives, are under way across the banking industry. Go said traditional banks are also making digital banking a part of their operations.

G o prefers to be “Darwinian” in describing this move being undertaken by Philippine banks. She said those who will survive longer would be those with the ability to