The Asian Development Bank (ADB) said Monday it awarded $655,000 in grants to nine rural banks and one bank consortium in the Philippines to accelerate digital transformation in the financial sector, particularly for underserved communities.
The grants are part of ADB’s Fintech for Inclusion Transformation (FIT) program funded by the High-Level Technology Fund and the Republic of Korea e-Asia and Knowledge Partnership Fund.
It said the awardees were chosen from among rural banks nationwide serving women, farmers, fisherfolk and micro, small and medium-sized enterprises, which submitted their digital transformation project proposals following the program’s launch in June 2023.
The Rural Bankers Association of the Philippines (RBAP) and the Bangko Sentral ng Pilipinas are supporting the grant program.
“The FIT program builds on ADB’s efforts to utilize technology to increase the efficiency, sustainability, and resilience of the finance sector, especially those which service underserved sectors in the country,” said ADB director for the finance sector group Emma Xiaoqin Fan.
The grant awardees aim to achieve more efficiency in their operations, reduce operational expenses and friction costs, expand their reach, improve customer service and build more resilient financial institutions overall.
Some of the digital transformation proposals involve putting up cloud-based core banking systems, loan origination systems and credit scoring systems.
The grant awardees come from across the Philippines, with six banks from Luzon, one from the Visayas and two from Mindanao. The awardees are Banco San Vicente, Camalig Bank, MVSM Bank, Rural Bank of Guinobatan, Rural Bank of Medina, Rural Bank of Montalban, Rural Bank of Porac, Rural Bank of Silay, and Rural Bank of Tandag. The Good Bank Consortium is composed of three rural banks.
The FIT program is part of the ADB-financed Inclusive Finance Development Program, which supported government reforms to expand Filipinos’ access to financial services, especially the unbanked segment of the population. The reforms are linked to the government’s National Strategy for Financial Inclusion.