Applications for MBOs hit 800 as of June

Applications for MBOs hit 800 as of June

BANKS HAVE continued to take advantage of the Bangko Sentral ng Pilipinas’ (BSP) move to ease bank branching, lodging 800 applications for micro-banking offices (MBOs) with the central bank.

“We have received 800 applications for micro-banking offices as of end-June, with 97 banks making the requests,” said Pia Bernadette Roman-Tayag, BSP head for financial inclusion, in her presentation during the 8th BSP Lecture Series for the Media held in Cebu last Saturday.

“More than half of these are already good to go,” she added.

The latest number of applications was higher by a hundred from the 700 received last May.

The central bank issued Circular 694 in October 2010 to allow banks to establish MBOs or MFOs (microfinance-oriented OBOs).

The new rules introduced a new variant of OBOs or other banking offices, which are permitted to do just non-transactional banking functions such as marketing, accepting of loan applications or hosting of automated teller machines.

MBOs or MFOs are allowed to do more, such as accept micro-deposits; disburse micro-loans and collect payments; sell, market and service micro-insurance products; and receive and pay out authorized remittance transactions.

The central bank hoped the new rules would encourage banks to expand -- particularly to unserved or underserved areas -- without shelling out the large sums they usually do for branches.

Ms. Tayag stressed that the applications for MBOs would help reach 1,635 unbanked municipalities in the country, noting that MBOs need not be attached to a microfinance bank or branch to be able to “offer a complete range of products.”

“This is significant as there are only 40-plus municipalities that are serviced only by OBOs,” she said.

The establishment of MBOs, among other initiatives, would ensure that the country’s financial system is more inclusive, she also pointed out. -- A. S. O. Alegado

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