Banks To Get Incentives To Invest In ARMM
Apr 12, 2017
The Regional Board of Investments (RBOI) in the Autonomous Region in Muslim Mindanao (ARMM) will be granting incentives to banks and non-bank financing institutions and facilities to include Islamic banking and finance. The expanded ARMM Organic Act (Republic Act No. 9054) allows ARMM to give incentives to banks and other non-bank financial institutions that are based or have its principal base of business in ARMM.
Incentivizing this sector could encourage conventional banks, other financial institutions like Islamic financing to set-up their business operations in the region and may address the problem of ARMM being severely underserviced by the financial sector. According to BSP, only 20 banks are operating in the region and about 93% of the region’s municipalities do not have banking presence representing the highest percentage of unbanked regions in the country.
Lawyer, Ishak Mastura, Chairman of RBOI said that there is a big opportunity for the banking and finance sector to develop new markets in the region because of the demand for their services. He further said that this is the reason why RBOI included banking and non-bank institutions in the ARMM List of the 2017-2019 Investment Priorities Plan (IPP). This is a significant move to address the call of various sectors such as the existing investors in the region, local and foreign, local business community, religious groups advocating for Islamic financing and the latest is the Social Security System (SSS) to put up bank branches to provide monetary and banking services to the constituents in ARMM.
The SSS concern is the lack of banking facilities in ARMM that hamper collection and disbursement activities of SSS through the banks.
Since 2012 to present, RBOI has registered a total of P14.621 billion worth of investments and recorded total jobs generated of 12,231. The increasing trend of investments in the region requires more banks to finance new and expanding projects for both foreign and domestic investments. “This will also allow individual borrowers to engage in businesses through credit facilities, assist personal needs like remittances of Overseas Filipino Workers (OFWs). The presence of more banks can attract investments in the region especially now that the ASEAN economic integration is in full swing and we need banks to be competitive”, Mastura said.
ARMM Governor, Mujiv Hataman said that aside from providing incentives to the financial sector, an advocacy on financial literacy in the ARMM is also important to encourage more depositors to save their money in the bank and maximize the use of banks and financial institutions to ensure the flow of money and support for a robust regional economy. (SOURCE: RBOI)