Microenterprise Access to Banking Services

MABS Mission

The Microenterprise Access to Banking services (MABS) Program works with Rural Banks to assist them to develop the capability to profitably provide financial services – loans, deposits, micro insurance, and money transfers – to the microenterprise sector.

MABS, a USAID-financed effort jointly implemented with the Rural Bankers Association of the Philippines (RBAP), with oversight provided by the Office of the President through the Mindanao Economic Development Council (MEDCo), is one of the principal elements of USAID-Philippines’ efforts to accelerate economic growth through expanded participation of lower income groups in productive activities.  Initially the program began in 1998, and has now been expanded in 2008 to broaden the range of financial services available to microenterprise clients.

The MABS step-by-step approach to microfinance has proven to be successful over the past ten years.  By combining technical training for our partner rural banks and consistently implementing new technologies, we have succeeded in developing the capacity of rural banks to expand access to banking services throughout the countryside.

The MABS program has helped many rural banks to become major players in the Philippine microfinance sector. As of October 2008, MABS participating rural banks have disbursed over 1.7 million loans totaling more than PhP21 billion (US$434 million) to more than 569,000 new bank borrowers. These partner banks also manage more than PhP1.7 billion (US$37 million) in small savings deposits from more than 1.4 million micro deposit accounts.

Despite these considerable achievements, there are still many more Filipino microentrepreneurs who do not have access to financial services. It is estimated that rural banks and other microfinance institutions are reaching only a third of the over 4 million families who are engaged in micro business activities.

While access to financial services is more challenging in the rural areas, rural banks continue to be in the best position to reach this market with a full range of microfinance services including loans, deposits, facilitating insurance and money transfer services, through their branches and smaller field offices or kiosks, which can now be opened much easier and faster than ever before. Advances in technology and the rapid expansion of mobile phone subscribers among microentrepreneurs and low income families mean that everyone can now also access banking services via a mobile phone from almost anywhere in the country.

Updated as of January 16, 2009