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BANKING ON EMPLOYMENT Rural banks continue to boost employment rate

Rural banks continue to break the myth that employment can only be found in the metropolitan parts of the country, as the rural banking sector remains the single...

 
PRLog - Nov. 5, 2009 - Rural banks continue to break the myth that employment can only be found in the metropolitan parts of the country, as the rural banking sector remains the single biggest contributor to the employment growth in the entire banking system in the country.

By their sheer huge presence in the countryside, rural banks have directly and directly pumped up the employment numbers as well as kept economic activity vibrant in that part of the country.

Rural Bankers Association of the Philippines (RBAP) President Joseph Omar Andaya explained that by focusing their expansion in the countryside, rural banks continue to be the main depository of hard-earned earnings of people in far-flung areas of the country.

Rural banks then allocate most of their assets in the countryside, through loans to farmers, fisher folks, and small and medium enterprises. In turn, farmers and fisher folks continue to enjoy a steady stream of income. SMEs, on the other hand, get to benefit from the steady presence of affordable loans from rural banks as they use these as capital to further expand their businesses, employing more people in the countryside as a result.

These entities then choose to deposit their savings in rural banks instead of traveling far to place their earnings in commercial or universal banks.

“We create a wonderful cycle of investments, employment, and deposits. We all help each other out,” said Mr. Andaya. “And we preserve that cycle by remaining in the countryside.”

Rural banks accounted for 71.6 percent of the net number of new employees generated by the entire banking system from December 2000 to June 2008.

Ninety-seven percent of the total number of rural bank branches is located outside Metro Manila, thus, accounting for the overwhelming majority of job creation in the countryside.

“We’re home, and we’ll never leave,” added Mr. Andaya. “Rural banks will continue to reach out to more microentrepreneurs, especially in provinces where our financial services are needed most.”

Over 400,000 micro business borrowers, including many who have not approached a bank before to apply for loans, were able to grow their businesses because of rural banks through the Microenterprise Access to Banking Services (MABS) Program.

The MABS Program was launched in Mindanao in 1997 and is jointly implemented by the United States Agency for International Development (USAID) and the RBAP. It assists privately-owned rural banks to develop their capability to profitably provide financial services, both loans and deposit services, to the microentreprise sector.

Mr. Andaya also expressed pride that RBAP has been able to help alleviate poverty in the country.

“The rural bank industry has helped realize thousands of dreams of people in the countryside and has supported the overall growth and development of their communities,” he said. “We’ve very happy to help a lot of rice farmers and millers, poultry and hog growers, and mini-grocery owners.”

The RBAP, numbering to more than 650 rural banks to date, was created primarily to advance the industry’s mandate to be the catalyst for countryside development as it provides the financial services to the unserved and underserved markets.

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Procommunication Inc. or PROCOM is a relatively young PR and IMC company based in Manila, the Philippines. We create full media campaigns that are multi-disciplinary in nature that are cost effective. Founded in May of 2003.

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Source:Procommunication Inc.
Country:Philippines
Industry:Employment
Tags:rural banks, procommunication inc, rbap, philippines, bsp, employment, mabs
Shortcut:prlog.org/10401918
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