Framing the Issues: Expanding Digital Financial Inclusion in the Philippines
The Philippines appears poised to become a world leader in the use of financial technology, or FinTech, due to several drivers. First, the geography of the Philippines, a nation of over 7,000 islands, demands an alternative to traditional brick-and-mortar banking infrastructure. Second, the population is young and mobile-savvy, with a median age of 25 years old, a mobile subscription rate of over 100 percent, and internet penetration of around two-thirds of the population. Third, the Philippines is one of the fastest growing economies in the world. As a result, this young population is increasingly prosperous, driving the demand for financial services. Fourth, the Philippines has a maturing sector of FinTech startups working across various verticals, including mobile payments, remittances, online lending, and small and medium-sized enterprise financing. Finally, the country’s financial sector regulators—the Bangko Sentral ng Pilipinas (BSP) and the Securities and Exchange Commission—are supportive of the growth of FinTech and have taken proactive steps to help develop the industry.