That said, while financial inclusion and literacy are significant contributors to a person’s financial resilience, it is important to also recognize the crucial role of access to public welfare programs such as those for healthcare, education, housing, and oldage pension in financial resilience. Cash transfers and pensions are two such public programs that more directly interact with financial inclusion as an efficiency mechanism and an ancillary objective. Who are the financially excluded? Financial exclusion disproportionately affects millions of Filipinos in the lower income classes and those who are unemployed, less educated, and belonging to the younger generation. Other underserved and unserved segments include senior citizens, migrant workers and their families, persons with disabilities, indigenous peoples, forcibly displaced persons, those who are excluded due to their religious beliefs, and other marginalized segments. Financial exclusion is also prevalent in the agriculture, MSME, and startup sectors as well as among informal workers. About 7 in 10 adult Filipinos are financially excluded, according to the 2019 FIS of the Bangko Sentral ng Pilipinas (BSP). This is based on the part of the adult population who own a transaction account that can be used to store, send, and receive funds. A significant gap in account penetration is seen especially in terms of socioeconomic class and employment status. Only 27% of those in the lower class (E) have an account, compared to 72% among the upper class (ABC1).6 Employed individuals are twice as likely (39%) to own an account than those who are unemployed (19%).
Note: All figures refer to account ownership. 2019 Financial Inclusion Survey (BSP, 2020)
Socioeconomic classifications: AB - upper class; C1 - upper middle class; C2 - upper lower class; D – middle class; and E – lower class. 6
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