BSP, IFC pushing for movable asset financing to boost credit access 

THE BANGKO Sentral ng Pilipinas (BSP) has signed a memorandum of understanding (MoU) with the International Finance Corp. (IFC) to jointly develop the country’s movable finance market as they hope to improve micro, small, and medium enterprises’ (MSMEs) and the agriculture sector’s access to credit. 

The BSP-IFC partnership will run until 2027 and will focus on regulatory reform, sector capacity building, and supporting services development, the central bank said in a statement on Wednesday. 

“The BSP looks forward to working with IFC to build a dynamic movable asset finance (MAF) ecosystem. With this, micro, small, and medium enterprises and agri-enterprises can use their available assets to access financing for their working capital and other needs,” BSP Governor Eli M. Remolona, Jr. said. 

Under the MoU signed on March 7, the BSP and IFC will jointly promote MAF, a lending approach that allows borrowers to secure loans with movable assets like inventories, receivables, and equipment. 

“This approach is designed to benefit borrowers who lack real property to serve as loan collateral, particularly those from the MSME and agricultural sectors,” the central bank said. 

“While the Philippines has the Personal Property Security Act in place, there is still a need to promote MAF. According to a 2022 IFC study, finance involving movable assets in the country remained under 5%,” the BSP said. “The partnership between the BSP and IFC is meant to complement the law and significantly increase loans secured by movable assets.” 

BSP Deputy Governor Bernadette Romulo-Puyat said the partnership is in line with the central bank’s National Strategy for Financial Inclusion 2022-2028. — AMCS