Philippines gets $300 million ADB loan for ‘financial inclusion goals’

MANILA, Philippines— The Asian Development Bank (ADB) on Thursday approved a $300 million dollar ($1.00= P56.74) loan to the Philippines to boost financial structures. 

The loan is part of ADB’s inclusive finance development program “to expand financial inclusion in the country by improving the country’s financial infrastructure, including widening the digital financing ecosystem.”

The bank is a financial institution that aids in the promotion of economic and social progress in Asia and the Pacific Region.

ADB said that the program also supports boosting the capabilities of financial service providers, such as rural banks and nonbank financial institutions.

“Through this loan, ADB is expanding its partnership with the Philippines in ensuring all Filipinos will have access to financial products and services, including via digital platforms, to help improve their lives and livelihoods,” ADB Senior Financial Sector Specialist Kelly Hattel said.

In 2021, Global Findex Database reported that more Filipino adults began using financial institutions and mobile money providers, with their numbers increasing from 34% in 2017 to 51% that year.

According to the ADB, this growth was accelerated by the COVID-19 pandemic lockdowns, nearly doubling the accounts held by the lower 40% income group from 18% in 2017 to 34% in 2021.

“Considering the significant impact of climate change on the vulnerable segments of the population, the reform actions supported by the loan will ensure government assistance can reach people faster during crises and emergencies; help raise climate resilience of farmers and micro, small, and medium-scale businesses through expanded insurance; and promote improved financial stability,” Hattel said.

Meanwhile, as of August 2023, the Philippines’ outstanding debt is already at P14.35 trillion.