ADB Grants to Fund Digital Transformation for 9 Philippine Rural Banks

By: FintechNews
Source: fintechnews


he Asian Development Bank (ADB) has allocated grants amounting to US$655,000 to support the digitalisation efforts of nine rural banks, plus a bank consortium in the Philippines. This financial assistance aims to facilitate these banks in adopting digital technologies to enhance their services, especially for the country’s underserved communities.

The banks set to benefit from this initiative include 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, the Rural Bank of Tandag, and the Good Bank Consortium, which comprises three rural lending institutions. These entities are expected to utilise the grants to streamline their operations, reduce expenses, widen access, improve client services, and bolster their resilience.

The ADB has indicated that the grants for the rural banks will be used for a range of digital transformation projects, including the introduction of cloud-based core banking systems, loan origination systems, and credit scoring systems. Such technological upgrades are intended to improve the efficiency and reach of financial services in rural areas.

This funding comes under the ADB’s Fintech for Inclusion Transformation (FIT) programme, which is dedicated to leveraging technology to improve the finance sector’s efficiency, sustainability, and resilience, with a particular focus on reaching underserved populations. Emma Xiaoqin Fan, ADB Director for the Finance Sector Group, noted the FIT programme’s contribution to expanding financial services to the unbanked.

The initiative is also part of the broader Inclusive Finance Development Program, which promotes reforms to increase financial inclusivity, with support from the Bangko Sentral ng Pilipinas and the Rural Bankers Association of the Philippines. In 2022, the ADB was recognised as the leading provider of active official development assistance to the Philippines, contributing 33.47% of the total ODA portfolio, equating to US$10.85 billion.

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