Angara urges leading financial firms to help spur Phl economic growth

SENATE OFFICE, Manila, April 17, 2011-Senator Edgardo J. Angara urged the country’s leading financial firms to help enhance credit to ensure the Filipinos to have the means to fuel their prosperity, and provide an instrument to help in economic recovery, following his calls to increase the availability of credit to small and medium scale entrepreneurs in order to spur the country’s economic growth.

In his keynote speech in the 30^th National Credit Congress sponsored by the Credit Management Association of the Philippines, he explained that while the Philippines wasn’t hit as badly as other ASEAN countries in the worldwide economic crisis, local financial institutions still needed to restrict access to credit.

“In our country we saw the most visible effect of the global financial crisis was the tightening of credit, it became harder to obtain loans for both business and households. This held enormous consequences not only for sustaining the growth of enterprises and welfare of families, but also for helping to survive a profound economic shock,” Angara said.

He furthered that the people who need it most are the entrepreneurs, farmers and households in rural areas who have the most difficulty in acquiring credit, due to their lack of a good credit standing.

 “We have to advocate for inclusive finance to ensure that our rural folks also cash in on the benefits of progress if we push for inclusive growth.  The microfinance, micro-agri loans and micro-insurance are the emerging needs in our countryside which we must seek to provide if we want to achieve a healthy economy,” Angara added.

Earlier, the volume of microfinance activity has grown in the country and an increasing number of financial institutions have engaged in retail microfinance operations for the last few years.

This sector has been traditionally dominated by rural banks, non-governmental organizations (NGOs) and finance cooperatives. In 2009 a number of commercial banks sought entrance into the retail microfinance market according to Asia Focus report reviews about the growth of the Philippines microfinance industry and discusses the implications of commercial banks entering this market. (Jason de Asis)