BSP defines microfinance customers

BSP defines microfinance customers

THE CENTRAL bank has come up with new rules specifying who can buy microinsurance at the banks it supervises.

Memorandum No. 27, issued on May 25 and addressed to thrift, rural and cooperative banks, defines microfinance clients as individuals with microfinance loans or microcredit; individuals with microfiance savings deposit accounts or microdeposits; or other existing bank clients classified by the banks as poor or having low-income.

BSP Deputy Governor Nestor A. Espenilla, Jr., in a text message, said the central bank issued the memorandum as “banks wanted practical guidance” in determining who to sell microinsurance.

“Microinsurance... can be offered only to microfinance clients, so we needed to clarify who these are,” Pia Bernadette Roman-Tayag, BSP financial inclusion head, explained in a separate text message.

Circular 623 issued last year allowed thrift, rural and cooperative banks to distribute microinsurance.

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