TWENTIETH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
First Regular Session
)
SENATE 
S. No. 953
v.D.'itrr ot
25 AUG-5 P4 :12
RliCElV DB\:
Introduced by Senator Jinggoy Ejercito Estrada
AN ACT
PROMOTING RURAL FINANCIAL INCLUSION AND LITERACY
EXPLANATORY NOTE
"Financial inclusion" is defined by the Bangko Sentral ng Pilipinas (BSP) as "a 
state wherein there is effective access to wide range of financial services for all, 
especially the vulnerable sectors. Effective access does not only mean that there are 
financial products and services that are available. These products and services must 
be appropriately designed, of good quality and responsive to the varied needs of 
individuals and businesses - whether for saving, payments, financing investments, 
or insurance."1
However, the promotion of greater financial inclusion and education in the 
country remains a challenge. In a study published by the Philippine Statistics 
Authority (PSA) entitled, "An Index of Financial Inclusion in the Philippines: 
Construction and Analysis", as of 2015, 591 of 1,634 cities and municipalities in the 
country remain unbanked. Also, "43% of Filipino adults have savings but 68% of 
them keep their savings at home and only 33% are saving in banks. Forty-seven
1Baneko Sentral ng Pilipinas Inclusive Finance (bsp.gov.ph)
1


percent (47%) of adults have outstanding loans but 72% borrow from informal 
sources such as family friends, relatives, and other informal lenders."2
In the year 2015, the National Strategy for Financial Inclusion (NSFI) was 
launched by the government and private sector stakeholders. It is a principles- 
based approach that serves as a blueprint to achieve the nation's vision of promoting 
financial inclusion for the realization of inclusive growth and financial resilience. It 
has four (4) strategic areas, namely: (1) policy, regulation and supervision; (2) 
financial education and consumer protection; (3) advocacy; and (4) data and 
measurement. It was recently updated with the NSFI 2022-2028.
By virtue of Executive Order No. 208 signed on June 2, 2016, the Financial 
Inclusion Steering Committee was established "as the governing body that shall 
provide strategic direction and guidance relative to the implementation of the NSFI 
and shall give advice to other stakeholders on meeting their objectives."
Since then, the BSP intensified its efforts to achieve these goals. They 
developed a comprehensive and interactive online information system and 
conducted various studies and activities related to it. As a result, the BSP reported 
that "from 2020 until the third quarter of 2021, about 20 million unbanked Filipino 
adults have been included in the formal system through the opening of basic deposit 
accounts (BDA) and active e-money accounts" and that "brought that banked adult 
Filipinos to 41 million, or about 53 percent of the total adult Filipinos to date."3
In 2023, the BSP and the PSA announced that there is a 170% increase in the 
number of Filipinos who opened BDA, having 7.5 million additional BDAs in the latter 
part of 2022.4
2Session 4-2 An Index of Financial Inclusion in the Philippines Construction and Analvsis.pdf (psa.gov.ph)
3Deposit accounts, e-monev boost BSP's financial inclusion bid I Philippine News Agency (pna.Rov.ph)
4 PSA Welcomes BSP Report on Increased Financial Inclusion, Citing Colocation Efforts With LANDBANK I
Philippine Statistics Authority I Republic of the Philippines


The "Rural Financial Inclusion and Literacy Act' will serve as the legal 
framework to sustain the efforts being undertaken by the BSP. It seeks to establish 
a Financial Inclusion and Digital Literacy Program that will promote the engagement 
with financial service institutions in rural areas and provide the public with the 
necessary knowledge and skills in making sound economic and financial decisions. It 
will be implemented by the NFISC which, under the proposed law, will still be 
chaired by the Governor of the BSP but with expanded membership. The 
marginalized sector of the society as well as the micro, small and medium, 
enterprises will be prioritized in the implementation of the program. To be able to 
establish a digital financial ecosystem in the country, especially in the provinces and 
rural areas, the priority implementation points shall include enhanced access to 
digital serves, provision of automated teller machines (ATMs) and satellite rural bank 
offices, efficient retail payments system, expansive network of low-cost touchpoints 
and accredited cash agents, democratized access to a transaction through the 
utilization of the national identification system, enhanced collaboration with rural 
financial institutions, and enhancement of the Tech4ED program of the Department 
of Information and Communications Technology (DICT).
In view of the foregoing, the swift approval of this bill is highly recommended.
INGGOY EJERCITO ESTRADA


TWENTIETH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
First Regular Session
)
f- V-' V ' fc’-“
. ''iBir.cf ot i : -
25 AUG-5 P4-.12
SENATE
S. No. 953
RUClIV.-j ui-
Introduced by Senator Jinggoy Ejercito Estrada
AN ACT
PROMOTING RURAL FINANCIAL INCLUSION AND LITERACY
Be it enacted by the Senate and House of Representatives of the Philippines in 
Congress assem bled:
1 
Section 1. Short Title. - This Act shall be known as the "Rural Financial
2 
Inclusion and Literacy Act".
3 
Sec. 2. Declaration of Policy. - It is the policy of the State to promote
4 
financial empowerment and reduce financial vulnerabilities among its citizens by
5 
taking proactive measures in developing technological capacities of various financial
6 
institutions in the rural areas to improve access to financial services. Toward this
7 
end, the State shall promote financial inclusion and literacy programs that contribute
8 
in establishing a financial system to benefit all Filipinos, regardless of socio-economic
9 
status, to accelerate economic growth and development especially in rural and
10 
provincial areas.
11 
Sec. 3. Financial Inclusion and Digital Literacy Program. - A proactive
12 
Financial Inclusion and Digital Literacy Program, hereinafter referred to as Program,
13 
is hereby established to promote the engagement with financial service institutions
14 
such as rural banks, lending companies, insurance and pre-need companies, and
15 
health maintenance organizations (HMOs) in rural areas. The Program includes the
16 
conduct of nationwide seminars and workshops, development of modules, trainings
17 
on organizational development and financial management on credit worthiness, loan


1 
acquisition and repayment, and wide dissemination of information and education
2 
campaign (lEC) materials that are tailored to different sectors.
3 
The Program shall also contain a basic understanding of concepts of financial
4 
inclusion, and may include technical application to provide the public with knowledge
5 
and skills to make well-informed economic and financial decisions. Priority sectors
6 
shall include small farmers, fisherfolk, and micro, small and medium enterprises
7 
(MSMEs).
8 
Sec. 4. Program Implementation. - The Program shall be implemented by the
9 
National Financial Inclusion Steering Committee (NFISC) chaired by the Governor of
10 
the Bangko Sentral ng Pilipinas (BSP).
11 
For a more inclusive implementation, local government units, non-government
12 
organizations (NGOs) and civil society organizations (CSOs) network, federation of
13 
cooperatives, cooperatives specially assisted by the Department of Agrarian Reform
14 
(DAR), shall also be included. Completion of a component of the Program may be
15 
used to comply with the requirements of financial institutions on various financial
16 
products such as savings, payment, credit, insurance, pre-need products and health
17 
maintenance services (HMOs).
18 
The NFISC, together with other stakeholders, shall optimize the use of all
19 
available mass media networks as an effective channel in promoting public
20 
awareness and education about the Program.
21 
Sec. 5. Capacity Building for Rural Banks. - Rural banks, and other financial
22 
institutions such as microfinance institutions and cooperatives operating in the rural
23 
areas shall establish capacity-building programs aimed at improving the knowledge
24 
and skills of their personnel on innovative technologies such as mobile payments,
25 
online lending, blockchain application, cloud computing, application programming
26 
interface (API) and artificial intelligence. Cybersecurity considerations and data
27 
privacy protection under Republic Act No. 10175, otherwise known as the
28 
"Cybercrime Prevention Act of 2012" and Republic Act No. 10173, otherwise known
29 
as the "Data Privacy Act of 2012" shall be considered and incorporated in the
30 
capacity building program.
31 
To further scale up the technology capabilities of rural banks, the Rural
32 
Bankers Association of the Philippines (RBAP) may assist its member banks by


1 
establishing industry-level standards on internet technology (IT) outsourcing and
2 
vendor management such as those pertaining with other recognized industry
3 
associations such as other bank associations, financial technology alliances, and
4 
reputable market players in organizing technology-focused briefings and/or
5 
information sessions for its member banks. Moreover, rural banks shall adhere to
6 
and comply with relevant BSP rules on technology and information security risk
7 
management.
8 
Informal financial service institutions shall be strengthened to improve their
9 
services in the rural areas by linking them to formal financial institutions, and setting
10 
up of community trainings to institutionalize their operation and reinforce their
11 
management capacity and governance.
12 
Sec. 6. National Financial Inclusion Steering Committee. - To further
13 
systematically accelerate financial inclusion, the National Financial Inclusion Steering
14 
Committee (NFISC) which is chaired by the Governor of the BSP shall spearhead
15 
collaborative efforts to address regulation and execute innovative modes of
16 
implementation.
17 
The NFISC is composed of heads of the following agencies:
18 
a) Department of Finance;
19 
b) Department of Education;
20 
c) Department of Trade and Industry;
21 
d) Department of Social Welfare and Development;
22 
e) Department of Budget and Management;
23 
f) National Economic and Development Authority;
24 
g) Insurance Commission;
25 
h) Commission on Filipinos Overseas;
26 
i) Securities and Exchange Commission;
27 
j) Philippine Statistics Authority;
28 
k) Philippine Deposit Insurance Corporation;
29 
I) Cooperative Development Authority;
30 
m) Department of Science and Technology;
31 
n) Department of Information and Communications Technology;
32 
o) Department of Agriculture;


1 
p) Department of Agrarian Reform;
2 
q) Department of the Interior and Local Government;
3 
r) Department of Labor and Employment;
4 
s) Department of Transportation; and
5 
t) Philippine Commission on Women.
6 
Heads of other government agencies may be invited as NFISC members
7 
whenever appropriate and necessary as deemed by the NFISC.
8 
Further, the NFISC shall prepare a roadmap for the Program to cover all
9 
regions, barangays, and the smallest units in the community, and provide for
10 
mechanisms that protect and boost financial activities, especially within 
the
11 
provinces and rural areas. The road map shall prioritize areas identified with high
12 
poverty incidence, particularly the poor and marginalized sectors of small farmers
13 
and fisherfolk who have limited access to credit from formal financial institutions.
14 
Consultation with government financial institutions (GFIs) should be
15 
continuously undertaken to address potential technical or administrative issues to
16 
ensure the effective and efficient roll out of financial technology among Filipinos,
17 
especially residing in rural communities and remote areas.
18 
All these government financial institutions and agencies shall also cooperate
19 
in the implementation of the National Strategy on Financial Inclusion, which is a
20 
comprehensive public document developed through a broad-based consultative
21 
process with private and public sector stakeholders involved in financial sector
22 
development to systematically accelerate the level of financial inclusion in the
23 
country.
24 
Sec. 7. Priority Impiementation Points. - There shall be priority agenda
25 
implementation points to establish a digital financial ecosystem that supports the
26 
diverse needs of all users in a manner that is secure, sustainable, convenient and
27 
affordable especially in provinces and rural areas. These priority implementation
28 
points include the following:
29 
a) Enhanced access to digital devices by strengthening local infrastructure
30 
support for digital and online platforms;
31 
b) Provision of automated teller machines (ATMs) and satellite rural bank
32 
offices;


1 
c) Efficient retail payments system;
2 
d) Expansive network of low-cost touchpoints and accredited cash agents;
3 
e) Democratized access to a transaction account through the utilization of a
4 
national identification system as mandated by Republic Act No. 11055,
5 
otherwise known as the "Philippine Identification System Act" (PhilSys
6 
Act);
7 
f) Enhanced collaboration with rural financial institutions such as rural banks,
8 
cooperatives, micro finance institutions, and other non-bank financial
9 
institutions (NBFIs) such as lending and financing and investment
10 
companies, securities dealers, brokers, 
pawnshops and other 
money
11 
service businesses;
12 
g) Enhanced Technology Empowerment for Education, Employment,
13 
Entrepreneurship and Economic Development Program (Tech4ED) of the
14 
Department of Information and Communications Technology (DICT) which
15 
provides critical information and communications technology enabled
16 
services in communities with minimal or no access to information and
17 
government services and learning 
and continuous skills development
18 
opportunities for special sectors including women, persons with disabilities
19 
and senior citizens.
20 
Sec. 8. Implementing Rules and Regulations. - Within ninety (90) days after
21 
the effectivity of this Act, the Governor of the Bangko Sentral ng Pilipinas and
22 
Members of the NFISC shall, in collaboration with the representatives from
23 
government financial institutions. Rural Bankers Association of the Philippines and
24 
other stakeholders, issue the necessary rules and regulations for the effective
25 
implementation of this Act.
26 
Sec. 9. Separability Clause. - If any provision or part hereof is held invalid or
27 
unconstitutional, the remainder of the law or the provision or part not otherwise
28 
affected shall remain valid and subsisting.
29 
Sec. 10. Repealing Clause. - Any law, presidential decree or issuance,
30 
executive order, letter of instruction, administrative order, rule, or regulation
31 
contrary to or inconsistent with the provisions of this Act are hereby repealed,
32 
modified, or amended accordingly.


1 
Sec. 11. Effectivity. - This Act shall take effect fifteen (15) days after its
2 
publication in the Official Gazette or in a newspaper of general circulation.
Approved,