The House Committee on Banks and Financial Intermediaries has recently endorsed for plenary approval the proposed Bangko sa Baryo (banks in countryside) Act, which seeks to authorize “cash agents” to help serve the banking needs of people living in faraway places without banks.
Deputy Speaker for Finance Luis Raymund F. Villafuerte said House Bill (HB) 1297 is part of a reform package designed to let government upgrade the delivery of its future social amelioration programs (SAP). Villafuerte added this would also help avoid a repeat of the hitches that had mired the initial release of cash subsidies to 18 million poor and low-income hardest hit by the coronavirus pandemic.
Authored by Villafuerte, HB 1297 empowers the chosen “authorized cash agents” (ACAs) to assist in performing a broad range of bank services, including forwarding account opening applications, cash-in and cash-out services, and initial customer identity verification.
Villafuerte said the proposed law is one of a trio of measures under the “new normal” scenario. HB 1297, if passed and enacted, also seeks to avoid repetition of the initial delay in the release by the social welfare and development department of P200-billion worth of cash aid to 18 million underprivileged families under the SAP; billed as the biggest social protection initiative ever in the country’s history.
His must-do list also includes the speedy and full implementation of the Philippine Identification System project and the National Broadband Program (NBP) of the Department of Information and Communications Technology (DICT).
The lawmaker explained that the World Bank has estimated that 60 percent of Filipinos remain unbanked while the Asian Development Bank (ADB) has said only 28 percent of Filipino adults own bank accounts.
Further citing ADB studies, Villafuerte said only 28 percent of Filipino adults own a bank account and only about 15 percent save money with a formal financial institution over a 12-month period, while only 10 percent borrow money from formal institutions over a similar timeframe.
The lawmaker pointed out in his bill that more than 36 percent of municipalities in the country have no banking presence.
To make sure the government could make seamless online transfers of cash to beneficiaries of future subsidy programs via all banks, remittance centers, pay platforms or his proposed ACAs, Villafuerte said the DICT needs to expedite its NBP, which aims to deploy fiber optic cables and wireless technologies, to ensure regional connectivity and improve Internet speed, especially in remote villages nationwide.
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