National Strategy for Financial Inclusion

The National Strategy for Financial Inclusion (NSFI) was constituted on February 26, 2014, through a consultative process and serves as a guidepost for public and private-sector stakeholders to accelerate financial inclusion in the Philippines. It was launched in July 2015 during the visit of the United Nations Secretary-General’s Special Advocate for Inclusive Finance and Development, Queen Maxima of the Netherlands. It was also during this launch when 12 government agencies and the Bangko Sentral ng Pilipinas signed a memorandum of understanding to signify their commitment to the NSFI.

Financial inclusion or an inclusive financial system is defined as “a state wherein there is effective access to a wide range of financial products and services by all.” Access to these financial products is important for the development of every household, and eventually for every Filipino. These financial products may be in the form of savings, payments, credit, investments, remittances and insurance. Savings refers to access to savings account, checking and current account, pensions and other forms of deposit accounts. Credit refers to personal consumer credit, credit cards, mortgage and other similar credit facilities. Payments refers to access to the different payment forms whether paper-based or electronic fund transfers. Remittances may either be domestic or international remittance facilities. Investments may involve equities, debts and other forms. Insurance may refer to life or nonlife insurance. With the formulation of a national strategy, it is clear that financial inclusion has become a policy objective of the national government.

Indeed, financial inclusion is a challenge in the Philippines. Only 4 out of 10 Filipino adults actually save. Sixty-eight percent of those who saved kept their monies at home. Thirty-three percent saved in banks, 7.5 percent in cooperatives and 2.6 percent in group savings (or paluwagan). As of the end of 2014, 36 percent of municipalities do not have a banking office. The number of domestic banking offices, though, have been increasing. As of the end of December 2014, there were 10,315 banking offices throughout the country, an increase from 7,585 in 2001.

In terms of credit, most loans extended are from informal sources, such as family, friends, and relatives (62 percent) and informal lenders (10 percent). The others obtained loans from financing companies (12 percent), cooperatives (10.5 percent), microfinance nongovernment organizations (9.9 percent) and banks (4.4 percent).

In terms of insurance, as of 2013, only 32.5 percent of the population was covered with life insurance.

The national strategy has formulated a vision: “A financial system that is accessible and responsive to the needs of the entire population toward a broad-based and inclusive growth.” In support of this, four pillars have been identified to support this vision: a) policy, regulation and supervision; b) financial education and consumer protection; c) advocacy programs; and d) data and measurement.

First Pillar: Policy, regulation and supervision. The government shall enable responsible innovation and market-based solutions while upholding financial stability and consumer protection. Institutions must set up effective and efficient financial infrastructure that will promote financial inclusion.

Second Pillar: Financial education and consumer protection. This can be carried out by forging partnerships and collaboration among key stakeholders. Another key is by developing and implementing targeted financial education programs.

Third Pillar: Advocacy programs. The key strategy is by raising awareness and support for financial inclusion.

Fourth Pillar: Data and measurement. Through this fourth pillar, institutions must create a robust financial inclusion database that will inform evidence-based policymaking. It will also enable progress monitoring and facilitate evaluation of financial inclusion initiatives.


Dennis B. Funa is the current insurance commissioner. Funa was appointed by President Duterte as the new insurance commissioner in December 2016. E-mail: [email protected]




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Atty. Dennis B. Funa is the current Insurance Commissioner. Atty. Funa was appointed by President Rodrigo R. Duterte as the new Insurance Commissioner in December 2016.


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