PHL’s slow but expensive Internet service

INTERNET access is no longer just a privilege for the rich, thanks to the ongoing global digital revolution. In the Philippines, however, access to the Web remains to be at the lower end of the spectrum.

And considering pronouncements from the United Nations (UN), this is another basic human right that Filipinos are being deprived of.

anniv01a-101316For Frank La Rue, the special rapporteur on freedom of expression and opinion of the UN, the Internet is a human right. Access to the Web, La Rue argued, is not merely a privilege for the rich and the famous, but is now considered a basic need, as the Internet is an avenue where people can enjoy their rights to freedom of expression and opinion.

It also gives people access to a marketplace of information—a library of ideas and opinions, where people converge and exchange concepts and ideas encompassing basically anything under the sun.

La Rue pointed out that the Internet, like any other medium, enables individuals to “seek, receive and impart information and ideas of all kinds instantaneously and inexpensively across national borders.”

“Given that the Internet has become an indispensable tool for realizing a range of human rights, combating inequality and accelerating development and human progress, ensuring universal access to the Internet should be a priority for all states. Each state should, thus, develop a concrete and effective policy…to make the Internet widely available, accessible and affordable to all segments of population,” he said.

But access to the Web in the Philippines remains low. In 2013 a United Nations Broadband Commission report that was published last year showed that only 23 of every 100 Filipino homes have access to broadband Internet.

It ranked the Philippines as 106th out of 191 countries surveyed for overall Internet-user penetration at a rate of 37 percent. This should have increased by now, as Philippine Long Distance Telephone Co. (PLDT) and Globe Telecom Inc. have launched in 2014 free Internet access to their subscribers.

Smart Communications Inc.’s mobile brands Smart, Sun and Talk ’N Text offered basic access to the Internet via mobile phones, while Globe offered free access to certain online applications, such as Facebook and Viber.

“Access to the Internet has transitioned from a want to a need,” National Telecommunications Commission (NTC) Director for Regulations Edgardo V. Cabarios said. “Thus the need for us to regulate it.”

Slow but expensive

While Internet penetration in the Philippines is expected to grow this year, the country’s average broadband speed versus the average price can be considered as being at the lower band of the service frequencies.

Again, the Philippines is an Asean laggard in this aspect.

Studies show that there is a significant disparity between the Philippines’s average speed and price, as compared to its neighbors.

For one, according to studies conducted by Ookla, an Internet metrics provider, the Philippines has the second-slowest average download speed among 22 countries in Asia.

As of May, the country’s average download speed reached 3.64 Mbps, ranking 176th out of 202 nations around the world. It is eight times slower than the global average broadband download speed of 23.3 Mbps.

Not surprisingly, Singapore, Hong Kong, Japan and South Korea topped the test in Asia. The Philippines has the slowest average broadband speed among the 10 Asean nations.

The Ookla report also showed that Filipinos pay more than their neighbors, with an average user spend of $18.19 per Mbps versus the global average of $5.21 per Mbps.

In a separate report, cloud-services provider Akamai Technologies said that, while the Philippines might have improved its connection by a percentage point, its overall ranking in Asia still remains at No. 13 out of 15, or the third-worst connection in the region.

Filipinos, according to the first-quarter report of Akamai, enjoyed an average download speed of 2.8 Mbps during the period under review. Trailing behind are India and Indonesia, with 2.3 Mpbs and 2.2 Mbps average speed, respectively.

Again, South Korea, Hong Kong, Japan and Singapore were the top 4, with their connection speeds touching the 70 Mbps-to-98.5 Mbps range at peak.


As the Philippines continues its losing streak in the broadband-speed wars, lawmakers are moving to conduct a probe to help improve the “pathetic state” of the Internet in the country.

The upper chamber was not at all happy with the numbers above. Sen. Paolo Benigno A. Aquino IV initiated a Senate investigation on the slow, but expensive Internet-service offerings in the country last year.

This year Sen. Francis G. Escudero also called for another inquiry on the state of the Philippine broadband market, calling it “unacceptable” given that it has a direct impact to many industries, like the business-process outsourcing sector, which currently helps grow the Philippine economy.

“The current situation in the country is, sad to say, unacceptable. The state of Internet speed is pathetic, and unless we remedy this situation, our IT [information technology] sector is likely to suffer in the long term,” he said. He called on the NTC to start cracking the whip and fix the system immediately.

“If they have to be mandated to allocate some of their earnings for improving Internet speed, mainly through investing in more equipment and hardware, then so be it,” Escudero said.

He added: “These telcos have been going to town in the past few years telling their shareholders that they have been earning billions of pesos. But they conveniently forget the millions of subscribers and users who put those billions in their coffers, but who continue to suffer from poor service.”

As of end-June, PLDT and Globe have a combined net income of P27.4 billion. “The point is, something needs to be done, and done very soon,” he said. “The problem is that government agencies that are supposed to monitor these telcos and help consumers don’t seem to feel the urgency of the situation.”

Just last week another Senate investigation was launched. Stakeholders gave updates as to the situation of the Internet market in the Philippines, and the updates were not at all too positive.

Teeth not sharp enough

But broadband is not a basic service, making it hard for the telecommunications commission to regulate the operations of Internet service providers.

Cabarios admitted that the office’s power in regulating the Internet speed and price is limited, despite the glaring fact that it has been a need for most Filipinos.

“We really need to amend the existing laws to give the commission additional powers to respond to new challenges,” he said.

Cabarios said the complaints filed at the NTC will show that Internet is not just a value-added service, but is already a need. “The number of complaints on broadband and data services has been increasing quickly—especially the mobile broadband segment.”

From January to July about 406 complaints  on  broadband connection were filed before the regulator. The number from the first month of the year to the seventh rose at an average rate of 80 percent.

The NTC started to segregate the complaints by their nature only this year, but Cabarios was sure the complaints filed against the telcos on legacy services—calls and texts—have been declining since Filipinos were introduced to free access to social media.

Making the Internet a basic service means the government will have the right to dictate the price and the speed of the connection.

There are proposals in Congress to amend the Public Service Act of 1936 to help the NTC regulate the price and speed of Internet services, but none has progressed so far.

“In the absence of a new law, we have to make use of the existing ones, and their limitations. We have to be creative as a regulator to do much within the limits of the law,” Cabarios said.

For example, since broadband is simply a value-added service, the regulator just issued the guidelines for a “minimum broadband speed” in the country.

NTC Commissioner Gamaliel A. Cordoba said his office has ordered Internet service providers to disclose the average speed of their connection per location starting September.

In a memo, Cordoba said the average connection for a fixed-line broadband plan should be on a par with the standard of the International Telecommunications Union, or at 256 kilobits per second.

Subscribers, he said, should always be updated as to the connection service that they are using, whether they reach the minimum requirement.

The NTC will procure Internet speed-test technologies to enact the memo, Cabarios said. Results will be published per area every month.

On the instance that subscribers will not enjoy the speed that were advertised to them, they can file complaints before the regulator, or the Department of Trade and Industry if it involves false advertising.

But the teeth of the law are not that sharp enough, Cordoba said.

“According to the Public Service Act of 1936, the penalty for such complaints is around P200. The law was promulgated in the 1930s, thus, it needs to be updated,” he said. The National Economic and Development Authority estimates that P200, when the law was promulgated, is equivalent to about P1.4 million in present time.

While the absence of the law restricts the regulator from its job, there are also other factors that affect Internet connection in the Philippines. These are topography, the lack of investments and the inefficiency in local peering.

WITHOUT an amendment to the mandate of the National Telecommunications Commission (NTC) and the reclassification of the Web access as a basic service, the regulator will only have little power over the Internet market in the Philippines.

But these are just a few of the factors that affect Internet speed and price. Another reason Internet connection in the Philippines is slower compared to its Association of Southeast Asian Nations (Asean) peers is the lack of investments—both public and private. NTC Director for Regulations Edgardo V. Cabarios said the Philippines is one of the developing countries that still do not have a universal-access fund.

“Under the existing laws, we do not have a so-called universal access. The law only states that we have to give priority to the development of infrastructure in unserved and underserved areas, but it did not specify how,” he said.

So, what happened was, private money was used to develop the needed infrastructure to provide Internet access.

It was not enough, however.

Need for a universal-access fund

“We let the private sector do it. But private investments require return,” Cabarios said. “There goes the problem. Can you bring the price down? No, because private investments require financial return. Nobody will invest if they will not get something out of their money.”

Private investments over the past 10 years, estimates show, likely reached more than P600 billion. However, these are limited to the networks of the two main telecommunications players in the Philippines.

Over the past decade, Philippine Long Distance Telephone Co. (PLDT) had invested P300 billion in network facilities and support infrastructure alone, company spokesman Ramon R. Isberto said.

Globe Telecom Inc., on the other hand, has been spending an average of P25 billion annually since 2005 to improve its network coverage.

This year the telecommunications company of Manuel V. Pangilinan has earmarked P43 billion to further develop its facilities and content, while the Ayala-led firm has programmed a P39.65-billion capital for this year.

“Average industry capital expenditures is at P60 billion per year, but this is not enough. For us to provide a 2-megabit-per-second [Mbps] connection to 80 percent of the households in the Philippines, we have to invest roughly P800 billion on the average,” Cabarios said.

But at the rate of P60 billion per year, it may take more than 10 years before each household could be equipped with such a speed.

“This plan is listed in the Philippine Digital Strategy, that by 2016, we should have a minimum 2-Mbps connection for each household. But the problem is, we do not know how, given the limited resources that we have,” the NTC official lamented.

Hence, private investments are helpful, but government intervention is needed.

“You cannot just let the private sector invest by itself. We have to address the problem in a comprehensive approach,” Cabarios said.

In Thailand, for example, the government has invested $114 million to improve the Internet service or availability. The fund is part of Bangkok’s economic policy.

The Vietnamese government, on the other hand, owns two of the three largest telecommunications companies in Ho Chi Minh City. Investments mainly come from the government.

Malaysia, he added, has now spent a total of $4.5 billion over a 10-year period to lay fiber-optic lines to every home in the country’s urban area.

Other developing and developed economies are investing billions of dollars to improve Internet access in their countries, Cabarios added.

“Universal-service funds have been created in developing countries, often in cooperation with the World Bank, as policy tools for liberalizing markets to provide financial assistance to meet regional and rural service targets for both telephony and Internet services, among others,” he said, citing a GSM Association report on access funds.

The problem is, there is no legislation for a universal-access fund in the Philippines.

“We have charges for power, road usage and water, but none in telecommunications. The proposal of the commission is for the fund to come from 1 percent of the total government revenue. We need that to deploy broadband in unserved areas and help small and medium enterprises to compete,” Cabarios said.

Thus, Internet infrastructure and pricing are controlled by the country’s top 2 telcos, Mary Grace Mirandilla-Santos, an independent researcher on information and communications technology (ICT) and telecommunications policies, said.

Absence of public backbone

A fellow of ICT policy and regulation think tank Learning Initiatives on Reforms for Network Economies (Lirne) Asia, Santos said the country is relying on the infrastructure of PLDT and Globe, both of which are not enough to provide adequate or decent access to all Filipinos.

“We do not have a national backbone. We rely on the private companies for infrastructure. What we need is a carrier-neutral backbone,” she said.

Engr. Rodolfo Noel I. Lozada agreed, comparing the current state of the country’s Internet connection to a network of roads and highways that were built over the long period of agricultural and industrial era.

“Those roads were built primarily by the government for public-transport use, allowing unhampered movements of people and goods that led to the progression of the Filipino nation to what it is now,” he said.

The tollways, however, were only built less than a decade ago, riding on the progression of the Philippine economy. The country is now in the cusp of the digital era, where digital products and goods are traded globally. This requires a transport infrastructure to move these digital goods.

“This is where the heart of the current problem lies. The government has not built any major digital highway for public use. Practically all of the digital roads and highways are privately owned and imposes a ‘toll fee’ per use,” Lozada explained.

“Can you imagine if all the roads and highways are all private toll roads? Traveling from any point to another location will be very expensive and slow,” he added.

In December last year, motorists complained that the normal five-hour drive going up to Baguio City took them 12 hours due to the queue at each toll-road junction connecting three superhighways.

Lozada said if only the government had built the National Broadband Network (NBN), the country could have been spared from the current slow Internet speeds.

“That is similar to how the government had built the public roads and highways during the agricultural and industrial era. It is a must for the government to provide for a big digital highway that allows very fast and free public transport of digital products and goods,” Lozada said.

He added that, with a state-owned backbone in place, “private service providers will be limited to providing on a pay-per-use arrangement the last mile connection to the end users and the local loop connection to the NBN.”

This design will provide a very fast and low-cost Internet service to the entire nation, to both cities and rural barangays alike, Lozada said.

“It will effectively negate the current worst of the Third World kind of Internet that the country is experiencing right now,” he said.

Lozada is best known for being the whistle-blower of the botched NBN-ZTE scandal during the Arroyo administration.

Sustainable exchange

This is where the peering between Internet service providers (ISPs) comes in. Essentially, the peering of Internet protocols (IPs) allows the exchange of Internet traffic among data-service providers, making it faster for the transfer of information from one point to another.

To do this, ISPs have to be linked via an Internet exchange, ideally in the Philippine Open Internet Exchange (Phopenix), a government-operated Internet-exchange facility.

“Without IP peering, local in-country Internet traffic needs to travel out of Philippine borders and be exchanged abroad, transit, before reaching its local destination. Enterprises that are IP peered with Phopenix will have cost savings, as local in-country Internet traffic exchanged through Phopenix will not count against the use of international network links or backhaul usage,” Democracy.Net.PH, a group that advocates for the Magna Carta for Philippine Internet Freedom, cofounder Pierre Tito Galla explained.

As local in-country Internet traffic will not need to transit abroad, ISPs will exchange with each other to lower latency—that is, better response times—and deliver this lower latency for the enjoyment of consumers.

Lower latency for consumers means a faster, more reliable and more stable Internet-connectivity experience, particularly for e-commerce transactions with businesses, financial institutions and government front-line services.

“IP peering helps the Philippines achieve a more robust, fault- and attack-resistant network infrastructure. As local in-country Internet traffic need not transit abroad, the impact of events such as submarine cable breaks and DDOS [distributed denial of service] attacks initiated by foreign cyberattackers and cybercriminals will be mitigated,” Galla said, referring to the DDOS attack.

A DDOS attack occurs when multiple systems “flood” the bandwidth of a targeted system, resulting in the unavailability of online services.

“This is especially true for government traffic, which may include sensitive national-security data and citizens’ personal information that can be exchanged locally through the Phopenix,” he said.

Simply put, IP peering allows consumers to enjoy “more robust, fault- and attack-resistant network infrastructure, which is personally important to consumers in their transactions through the Internet, such as tax filing, banking, e-commerce and Skype conversations with family and friends overseas, among the many uses of fast, reliable and inexpensive Internet.”

But there exists a lack of effective and reliable interconnection among ISPs.

PLDT and its subsidiaries are not too positive with the mandated IP-peering policy of the government.

For the country’s No.1 telecommunications provider, peering through a single, government-owned Internet exchange should have a “basic multilateral-peering framework” to trade traffic.

Isberto said his company is now in discussion with the Department of Science and Technology-Advanced Science and Technology Institute (DOST-ASTI) to make its open Internet exchange more sustainable.

“Globally, the sustainability of an open Internet exchange is largely dependent on its members adhering to basic multilateral peering framework leading to a member-governed Internet exchange that allows participants to trade traffic,” he said.

While working to develop such multilateral peering framework, PLDT was able to reach an agreement with DOST-ASTI on the free use of PLDT fiber and collocation facilities for the open Internet exchange.

“This would allow the DOST to set up and operate a Phopenix node in PLDT’s Vitro Data Center facility. This arrangement will not only facilitate future bilateral peering-connectivity engagements between PLDT and Phopenix members but, more important, the multiple node setup will also provide additional resiliency to Phopenix’s network,” Isberto said.

Globe general legal counsel Froilan M. Castelo said the proposed peering arrangements should have minimum to no cost at all to the telecommunications players.

“Globe maintains that there should not be any access charge to this to maintain or lower Internet costs. A draft NTC memorandum circular on Internet peering, circulated for the industry players’ comment in 2011, ‘orders all ISPs in the Philippines to deliver and receive traffic between domestic end-points and without passing the traffic across the international border.’ We have proposed that such delivery and receipt of traffic should also be free of Internet-peering charges,” he said.

Castelo added that the open exchange should be telco-neutral to keep traffic local and peering charge-free.

“The Internet exchange proposed by Globe and other ISPs will allow participating networks to be physically interconnected in a single facility, and traffic from one member ISP passing through this Internet exchange will not be billed by the other member ISPs. Also, operating costs shall be equally shared by all participants. We believe this arrangement will level the playing field,” Castelo said.

No brunt for consumers

Galla assured consumers that the peering policy  will not have any negative effect to consumers.

“Unlike increasing transit and settlement, consumers need not fear increases in costs that are passed on to them; with IP peering, consumers can expect decreases in costs of bandwidth. Nor should consumers expect increased costs due to additional capital expenditure on the part of telecommunications companies; IP peering with Phopenix does not require heavy capital expenditure,” he said.

With the reduction in the need for transit, consumers can expect lesser latency or “lag”. With the reduced requirement for transit bandwidth, consumers can expect telecommunications firms to use their cost savings to improve their network infrastructure and even perhaps reduce the costs of bandwidth.

IP peering, he added, is likewise beneficial to the ISPs.

“As far as telecommunications entities are concerned, the fact that Globe Telecom is peered with Phopenix and is urging its competitor PLDT and its affiliates to do the same, supported by the fact that many other competing telecommunications entities, service providers, government networks and other entities are peered with Phopenix, is a clear signal to the industry that IP peering is good for each enterprise individually and for the ICT sector as a whole,” Galla said.

Localization of content

But given the current situation—wherein there is an apparent lack of effective and reliable interconnection among ISPs—the possible localization of foreign content is being stalled. Having localized foreign content allows for the faster loading of data from web sites.

“One of the inherent problems relating to the Internet is that all the foreign traffic has to run through undersea cables. The way to improve Internet speed in the country is to get foreign content localized,” said Louis Napoleon C. Casambre, undersecretary of the DOST.

This, according to the NTC’s Cabarios, would entail the setting up of caches of content providers in the Phopenix.

Having a cache in an Internet exchange will allow faster loading of data. Google, for one, has deployed a cache here in Manila, hence, it loads faster compared to other web sites.

“The fact that deploying a cache here in the Philippines is not easily done implies that the cost is quite high. Their considerations are the average Internet traffic in the Philippines, revenues from advertising, among others,” Cabarios said.

Isberto said around 90 percent of the content being accessed in the Philippines is foreign.

GIVEN that the slow but expensive Internet connection in the Philippines is a result of a confluence of problems—from the lack of infrastructure investment to inadequate government funding and the absence of sustainable peering among providers—addressing the need for better Web access can only be achieved in a holistic manner.

Aside from updating the law that hampers the National Telecommunications Commission (NTC) from regulating Internet as a basic service and several measures that pertain to competition, foreign ownership and public service, the national government must also team up with the private sector to address the problem comprehensively.

NTC Director for Regulations Edgardo V. Cabarios underscored the importance of a universal-access fund to increase government spending for Internet access.

“One of the reasons Internet connection prices are high is because of subsidies being spent by telcos to provide access to low-traffic areas. The government should invest, so we can reduce the subsidies by the private sector,” he said.

Philippine Long Distance Telephone Co. (PLDT) Spokesman Ramon R. Isberto, on the other hand, pointed out that the private sector would find it more attractive if the government would grant incentives to investments in the information and communications technology (ICT) sector.

“There are no private-sector incentives for investment in ICT infrastructure. There is no current program in that area. That seems to be puzzling why there is no such provision,” he lamented.

Isberto, who also speaks for Smart Communications Inc. and its subsidiaries, noted that his group is ready to invest more to improve the state of Internet service in the country.

His camp, he emphasized, is willing to work hand-in-hand with the government to put the Philippine Internet market on a par with its neighbors. Cabarios also suggested the establishment of an interagency body to review how the government should move to improve Internet speed in the Philippines.

“I recommend the creation of an interagency body with Congress to study government intervention in infrastructure to increase Internet speed and penetration,” he said.

This points to the establishment of a state-owned backbone, which, according to ICT policy and regulation think tank Learning Initiatives on Reforms for Network Economies Asia fellow Mary Grace Mirandilla-Santos, is a need to lessen costs and improve speed.

“The lack of government support to set up a national backbone prevents us from improving the state of the Internet in the Philippines,” she said. Globe’s Castelo agreed, saying that Internet service providers (ISPs) must peer through a telco-neutral Internet exchange to lower costs and improve speed.

“The absence of an effective and reliable domestic Internet protocol [IP] peering among local telecommunication providers weighs down on local Internet speeds. An IP peering arrangement will enhance Internet speeds and could possibly lower Internet connectivity costs,” he said.

But for Isberto and Cabarios, IP peering is only a short-term solution.

“IP peering should help improve the quality of user experience for local Internet traffic. This will benefit not only our customers but also those of other ISPs.  But, as we have explained in previous discussions, this is not enough. This is because the bulk of Internet content accessed by Filipinos comes from overseas,” Isberto said.

To improve customer experience for this type of Internet traffic, wherein 90 percent of content comes from abroad, ISPs should increase their international IP transit capacity and, at the same time, increase the amount of popular global Internet content stored or “cached” in the Philippines.

“IP peering will address some concerns, but not everything,” he said. “The government really needs to invest.” At the end of the day, a partnership between the private sector and the government will address the problems in Internet access and speed.

“It’s both a government intervention or a private-sector or market solution,” Sen. Paolo Benigno A. Aquino IV said. “We can only improve and speed up Internet connection in our country by the said partnership.”

Economic impact

The fuss with all the talks on Internet speed, price and access is relevant to the growth of the Philippine economy, the country’s chief economic planner said.

The current state of the Internet in the Philippines is constraining the economy from growing further, National Economic and Development Authority Director General Arsenio M. Balisacan explained.

“The high cost of Internet, and the very slow speed, is constraining the capacity of the economy to achieve a faster growth. We really need to do something about that because it is a major driver for our growth,” he said.

Cabarios agreed, saying that there is a direct correlation between broadband access and the growth of a country’s GDP.

“Where there is an increase of 10 percent in broadband penetration, there is also a 1.23-percent increase in GDP.  When you double the speed of the connection, the GDP will also rise by 0.3 percent,” he said.

The economic planner added that the government should invest more in ICT infrastructure to bolster the growth of the economy, if not sustain it.

“For our economy to sustain its rapid growth of 6 percent to 7 percent in the coming  two to three decades—the period that we would need to catch up with our neighbors—we would need to invest aggressively and massively in infrastructure; and ICT is one of them,” Balisacan said.

The government spent about P1.76 billion in ICT development last year. For 2015 the government has earmarked about P3.18 billion to develop the sector.

Now the government is moving to increase the budget for ICT development next year with a proposed allocation of P4.37 billion.

“I think we should have more given the backlogs in the access to ICT,” he noted. “If we want inclusivity, the tool for achieving that low-lying fruit needs a few billion pesos more.”

Balisacan added that his office will be discussing the next medium-term plan, or through 2022, ahead of the next administration.

“We’ll be happy to help. In 2016 we’ll be crafting the next medium-term plan of 2017 to 2022. This is an opportunity to put into the plan an aggressive stance on ICT access,” Balisacan said.

Promote inclusive growth

Balisacan also said the Internet is a means to promote inclusive growth, calling it a “great equalizer” that needs to be improved.

“If you want inclusive growth, we need to get information accessible to areas without Internet connection,” he said.

Indeed, the Internet will play a key role in shaping the future of the Philippine economy, the International Data Corp. (IDC), an ICT think tank, predicted.

According to IDC Philippines Country Head Jubert Alberto, telecommunications companies will focus on developing their network and coverage to provide better access to Filipinos. They have been, in fact, transitioning from a legacy mobile and telephony providers to digital enablers.

“The telco space in the Philippines is bolstered by the evolving role of telcos from being a pure connectivity provider to becoming a total ICT provider. The ‘one to majority’ marketplace allows for telcos in the Philippines to be the services provider that can service various marketplaces,” he said.

PLDT and Globe Telecom Inc. have been, over the past few years, launching various digital initiatives that promote the access to the Web.

Smart, Sun and Talk ’N Text—the mobile brands of PLDT—are currently offering free Web access with a data cap of 30 megabytes per day. This is on top of the free access to several applications, like social-media site Facebook.

Globe, on the other hand, offers free access to Facebook and Viber.

Many Filipinos today get relevant information from social media, as smartphone penetration in the Philippines continues to grow. It is now pegged at more than 50 percent, thanks to the proliferation of cheap mobile devices from China.

Mobile phones are also being used as virtual wallets. Both Smart and Globe offer their own e-money service. PLDT even partnered with the government to release conditional cash transfers to the poorest of the poor.

There is still a large number of Filipinos who remain unbanked and uncarded. World Bank data showed that only three of 10 Filipinos have bank accounts, and only 18 percent of all adults in the poorest 40 percent of the households in the Philippines are banked.

Financial inclusion, according to the monetary agency, is classified as “having an account that allows adults to store money and make and receive electronic payments.”

Aside from these, the top 2 telcos in the Philippines are also ramping up their efforts to promote the digital lifestyle to Filipinos. This also entails services that promote inclusive growth to the poorest of the poor.

“If we can make available those possibilities also for our poor people, those outside of Metro Manila and those who are in far-flung areas, then you have developed a tool for inclusive growth,” Balisacan said.


This article came out on August 24, 2015, and was adjudged the Best Business Feature Story in the 2016 Economic Journalists Association of the Philippines Journalism Awards.


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