limit on loans to msmes and large enterprises used as alternative compliance at p300 billion and p425 billion, respectively. supported by liquidity - enhancing measures of the bsp, latest data suggest that there is ample liquidity in the financial system. domestic liquidity expanded by 11. 8 percent ( y - o - y ) to about p13. 5 trillion in october 2020 from 12. 2 percent in september. domestic liquidity dynamics and market function have improved as a result of the bsp ’ s liquidityenhancing measures. the monetary board ( mb ) believes that keeping an accommodative stance has been critical in ensuring favorable financing conditions to support economic activity and market sentiment. with adequate liquidity in the financial system, domestic interest rates have gradually declined over the past several months. in line with its financial inclusion initiatives, the bsp also continued to push for the use of digital financial platforms. this is consistent with our vision to shift from a cash - heavy to a cash - lite economy. under the digital payments transformation roadmap for 2020 to 2023, the bsp aims ( 1 ) to strengthen customers ’ preference for digital payments by converting 50 percent of the total volume of retail payments into digital form ; and expand the proportion of financially included to 70 percent of filipino adults and ( 2 ) to encourage innovations which will boost real - time payments velocity. we also supported digital payment initiatives such as the use of electronic fund transfers via instapay and pesonet, as well as the expansion of low - cost access points through cash agents 2 / 4 bis central bankers'speeches or third - party outlets. in the near term, we are set to pursue more of these digital payment initiatives. allow me to underscore that implementing measures to address the impact of the pandemic has provided valuable lessons. first, the crisis experience has required central banks, including the bsp to be more agile. this pandemic differs from other crises episodes in the sense that it has had a solid and fast influence on domestic and global demand. the covid - 19 crisis has also taught us that there are limits to what monetary policy can do. when interest rates are low and private demand are persistently weak, the transmission from financing conditions to private spending might be reduced. thus, it is crucial that monetary policy ensures favorable financing conditions for the whole economy. this limitation to monetary policy highlights the critical role of the targeted fiscal policy responses and undersco

##res the need for a whole - of - government approach to combatting the pandemic. meanwhile, persistent bank risk aversion and bleak loan demand continue to contribute to weak credit activity. preliminary data show that growth in outstanding loans of universal and commercial banks, net of reverse repurchase ( rrp ) placements with the bsp, eased to 1. 9 percent in october from 2. 6 percent ( revised ) in september. the overall slowdown in bank lending growth points to muted business confidence and elevated uncertainty amid continued disruptions in business operations. this phenomenon of weak credit activity amid the crisis is similarly observed in other economies. results of the q3 2020 senior bank loan officers ’ survey ( slos ) show that the majority of respondent banks continued to report tighter overall credit standards in q3 2020, although they are fewer compared to q2 2020, based on the modal approach. based on the diffusion index ( di approach ), banks reported a net tightening of overall credit standards for both loans to enterprises and households in q3 2020. respondent banks attributed the tightening of credit standards largely to ( 1 ) less favorable economic outlook, ( 2 ) deterioration in the profitability of bank ’ s portfolio and profiles of borrowers, and ( 3 ) reduced tolerance for risk, among other factors. nonetheless, improvements in mobility indicators indicate that firms and households are beginning to adjust to the post - pandemic operating environment. this could support resurgence in economic activity in the near term. in this slide, we show mobility changes as monitored by google for the entire country. from the charts, we can see that as of 29 december 2020, visits to places such as grocery and pharmacy and parks have approached their pre - covid levels visits to retail and recreation also continues to show improvement. meanwhile, mobility in transit stations is still flat given that transport options have remained limited. for 2021, the economy is expected to bounce back, growing by 6. 5 – 7. 5 percent. this is based on projections by the development budget coordination committee as of december 2020. growth is expected driven by higher government spending and the passage of structural reform programs such as the corporate recovery and tax incentives for enterprises ( create ) bill and the financial institutions strategic transfer ( fist ) bill. the bsp remains cognizant of economic developments and financial conditions, including the potential impact of a prolonged covid - 19 health crisis. in view of this, bsp reaffirms its 3 / 4