COTABATO CITY, April 18, (PIA)-- Banks and non-bank financial institutions and facilities – including Islamic banks and financing establishments that invest in the Autonomous Region in Muslim Mindanao (ARMM) can avail of incentives, ARMM’s Regional Board of Investments (RBOI).
Lawyer Ishak Mastura, chairman of RBOI-ARMM said giving incentives to 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.
Citing data from the Bangko Sentral ng Pilipinas, Mastura noted that only 20 banks are currently operating in ARMM and that about 93 percent of municipalities in the region do not have banking presence, representing the highest presence of unbanked regions in the country.
Mastura emphasized 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.
This is the reason why RBOI included banking and non-bank institutions in the ARMM List of the 2017-2019 Investment Priorities Plan (IPP), he added, noting further that this is 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.
SSS is concerned over the lack of banking facilities in ARMM that hamper their collection and disbursement activities through banks.
Granting of incentives banks and non-bank financial institutions that are based or have its principal base of business in the ARMM is allowed under the Republic Act 9054 or the Expanded ARMM Organic Act
Since 2012, 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.
Meanwhile, 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. (DEDoguiles-PIA 12 with report from ARMM-RBOI)