Amando Tetangco: 2016 outstanding microentrepreneurs - leading
the way to success
Speech by Mr Amando M Tetangco, Jr, Governor of Bangko Sentral ng Pilipinas (BSP, the
central bank of the Philippines), at the 14th Citi Microentrepreneurship Awards (CMA), Manila, 6
December 2016.
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It is always a pleasure to be in the company of microentrepreneurs and fellow advocates of the
development of the microfinance industry in our country.
I look at this annual event as a gift - an early Christmas gift. The finalists and the winners of the
Citi Microentrepreneurship Awards give us many reasons to celebrate - their courage, their
creativity, their tenacity and their success. In so many ways, you inspire confidence and serve
as role models among those who are just starting their own micro ventures.
And from you, the other stakeholders of the microfinance industry learn how we can help sustain
your viability and growth - this includes the Bangko Sentral ng Pilipinas, the Microfinance
Council of the Philippines, the banks including Citi, NGOs and other service providers.
In the process, we are able to craft better policies and programs to keep the microfinance
industry strong and healthy. This synergy between microentrepeneurs and other industry
stakeholders has produced solid results.
On our part, the BSP, since 2000, has been nurturing a policy environment that enables the
delivery of commercially sustainable microfinance in the banking sector. We liberalized
regulations by reducing barriers and providing incentives while balancing them with risk
management measures.
In particular, we took into account the unique characteristics of microfinance such as the use of
group liability arrangements, cash flow based and character lending, high frequency
amortizations, and having less documentary requirements. Our policy is working as intended, as
banks get more involved in microfinance.
Let me share some highlights. As of June 2016, there were 169 banks involved in microfinance -
most of them rural banks in the countryside. Combined, they have more than 1.6 million
microentrepreneur clients (from 391,000 in 2002) with aggregate outstanding loans of P11.7
billion, an almost five-fold increase from the levels in the early 2000s (P2.6 billion in 2002). The
banks have also empowered these clients to save, many of them for the first time. At present,
these microentrepreneurs have accumulated savings of P 5.2 billion. In addition, the
microfinance sector has become a market for microfinance products like micro-insurance and
micro-housing loans.
Because of the significant strides we have made together, the Philippines is considered a global
leader in microfinance. For five years in a row - between 2009 to 2013- the global survey on
microfinance by the Economist Intelligence Unit (EIU) ranked the Philippines as number one in
the world in terms of regulatory framework for microfinance.
EIU has since amended its survey to measure financial inclusion. In this survey we also rank as
a global leader: in 2016, the EIU ranks Peru and Columbia as the top two, while the Philippines
and India are third in the world and first in Asia with the most conducive environment for financial
inclusion.
Improvements in overall access to financial services in the Philippines is also reflected in the
World Bank Findex, the global database for financial inclusion. It said formal account ownership
among Filipino adults increased from 26.6% in 2011 to 31.3% in 2014, with higher growth among
low income and less educated segments of our population.
Ladies and gentlemen. Our CMA awardees for this year are among the most diverse set of
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winners, coming from a range of industries. But they have two things in common: 1) they
demostrate how financial inclusion and microfinance can unlock opportunities and 2) they serve
as catalysts for the development of their ventures in various areas.
Indeed, our efforts to build an inclusive financial system result in better access to financial
products and services that empower individuals and enterprises to seize economic
opportunities.
And we continue to develop enabling policies and regulations to reach unserved and underserved
markets. Last March, for instance, we issued BSP Circular 908 or the Agricultural Value Chain
Financing Framework which aims to address agricultural credit risks by shifting the focus of
lending from individual farmers and fisherfolks to the whole value chain . This will benefit
microenterprises that are involved in value chains as it provides an opportunity to open up credit
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to all the players in the chain.
As designed, the AVCF Framework not only addresses financing constraints of small players but
also allows them to take on other challenges such as access to markets, business development,
and technology. In other words, it is a response by the BSP to various issues that hamper the
potential for growth of MSMEs.
Given the multiplicity of challenges, a collective and collaborative approach is the most ideal
strategy to promote inclusive growth. Closer coordination of various players will ensure that
complementarities and synergies are identified among and across efforts and unnecessary
duplications minimized.
On a broader scale, this coordinated approach is also the value proposition of the National
Strategy for Financial Inclusion (NSFI), the platform for public and private sector coordination to
ensure synergy of efforts for a systematic approach to countrywide development through
financial inclusion.
This is exactly the type of coordination that has made the CMA a success. For 14 years now, we
- the BSP, Citibank, Citi Foundation and Microfinance Council of the Philippines, Inc. (MCPI),
together with the members of the National Selection Committee and the Country teams, and
other microfinance advocates - have worked together to constantly improve the design and
implementation of the program. Thank you everyone!
And most of all, we thank and congratulate our CMA winners and finalists, as well as the other
microentrepreneurs across the country for your steadfast and dedicated efforts that make lives
better not only for your families but also for your communities. Maraming salamat sa inyong
lahat!
Mabuhay ang CMA Winners natin!
Mabuhay ang Filipino microentrepreneurs!
Mabuhay po tayong lahat!
(recycled rubber tires), and youth (tablea and coffee).
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A value chain is defined as a set of actors, suppliers, processors, and aggregators who conduct linked
sequence of value-adding activities involved in bringing a product from its raw material stage to the consumers.