The $ 400 million Development Policy Loan (DPL) to the Philippines that the World Bank just approved will make the country’s financial sector resilient to shocks as the economy recovers from the pandemic-induced crisis, said the Washington-based lender.
The rapid-disbursement financing of the development policy of the financial sector reform, which the Board of Directors of the World Bank gave the green light on June 24, will strengthen the stability of the financial sector, expand financial inclusion among businesses and individuals and will promote disaster risk financing, the lender said in a statement.
“Among the policy reforms supported by this DPL are measures addressing legal, regulatory and supervisory issues in order to improve the prudential supervision of banks by the Bangko Sentral ng Pilipinas; align insurance legislation in the Philippines with global standards and ensure long-term availability of credit to small and medium-sized enterprises, ”the World Bank said.
To expand access to finance for individuals and businesses, this DPL supports reforms to promote innovative financial services by harnessing digital technologies and increasing the reliability of credit information, he added.
“To catalyze disaster risk and green finance, this DPL supports the efforts of the government and the private sector in setting up risk pooling mechanisms based on a public-private partnership (PPP) for catastrophe insurance. It also supports the resilience of the financial sector to climate-related shocks by integrating climate and environmental risks into the risk management frameworks of financial institutions and by mobilizing finance for environmentally friendly projects, ”according to the World Bank.
The Ministry of Finance will implement this project. —Ben O. from Vera
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