Holding banks accountable for the actions of their cash agents will provide better protection for consumers, especially those who rely on the “padala” of their relatives to help them get by during these trying times.
Senator Grace Poe said the central bank’s push for financial inclusion will benefit from the necessary safeguards and encourage more to consider tapping the services of formal channels.
“Many of our countrymen are intimidated to go to banks, that’s why there is this informal economy and underground lenders. Even if the terms aren’t good, they gravitate toward them out of familiarity,” Poe said.
“There are 17,000 cash agents now serving 79% of the country.”
At the hearing on proposals for a Bangko sa Baryo led by the Senate committee on banks, financial institutions and currencies, the Bangko Sentral ng Pilipinas (BSP) said there are 17,000 cash agents nationwide now serving 79 percent of the country that suggests 21 percent remain unserved.
The BSP said that 13 banks have cash agent operations and it is purely up to the banks on how they would choose their cash agents based on their selection criteria.
While the BSP requires banks to get its approval when getting cash agents, the choice of which cash agents to get and the parameters of their engagement also rest with the banks.
The veteran legislator’s committee is looking at formalizing accountabilities and making banks take responsibility for their cash agents by spelling out safeguards in the proposed law.
“We must ensure full accountability as we seek to institutionalize the inclusion of cash agents in serving the unbanked,” the seasoned lawmaker said.
Aside from the “padala” to relatives within the Philippines, overseas Filipino workers (OFWs) will also benefit from such safeguards.
“The number of OFWs is at 2.2 million in 2019 and their remittances amounted to over $33.5 billion.”
The Philippine Statistics Authority estimated the number of OFWs at 2.2 million in 2019 and their remittances amounted to over $33.5 billion.
Some of them would still require the services of a cash agent if their hometown is not currently serviced by a bank as a number of towns still remain unserved.
