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Accelerating Financial Inclusion; Bridging Progress in Communities

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State-owned Development Bank of the Philippines (DBP) marks its 73rd anniversary this year with an intensified focus on financial inclusivity, providing strategic support to the underserved and unbanked sectors of the economy whilst catalyzing progress in the countryside.

Expanding financial inclusion through digital financial services, DBP signed an agreement with the Provincial Government of Isabela, the Nagkaisang Magsasaka ng Isabela (NMI) Agriculture Cooperative, and PayMaya Philippines to facilitate the cashless disbursement of funds to more than 5,000 farmer-members of NMI Agri-Coop, including the proceeds of more than 5,000 tobacco farmers’ share from excise taxes.

The bank opened a financing window for NMI Agri-Coop under the Expanded Rice Credit Assistance of the Rice Competitiveness Enhancement Fund (ERCA-RCEF) component of the Rice Tarrification Law.  Loan proceeds were utilized as working capital to procure palay from the marginalized member-farmers of the coop, at a premium rate, with trading and all other financial transactions coursed through ATM ID cards.

DBP continued to ramp up support to the National Government’s Public Utility Vehicle Modernization Program (PUVMP), approving a total loan amount of P1.18-billion to 24 transport cooperatives under its P1.5-billion Program Assistance to Support Alternative Driving Approaches (PASADA) initiative, covering the acquisition of 629 modern and environment-friendly jeepney units nationwide.

The DBP PASADA promotes the ‘fleet management’ concept which organizes public transport services to provide a steady source of livelihood for drivers while ensuring a reliable, efficient, and safe means of transportation for the public.  The program won the Best Innovation in Financial Services Award during The Global Sustainable Finance Awards 2019 held in Karlsruhe, Germany.

Demonstrating DBP’s commitment to both environmental stewardship and community development, the bank along with other lending institutions provided financing to one of the country’s largest bulk water supply projects in Mindanao.  A first in the country, the project’s water treatment facility will be powered by renewable energy sourced from its own run-of-river hydroelectric power plant.

The project by Apo Agua Infrastructura, Inc., which will supply over 300 million liters per day of safe and sustainable water, bagged the Utility Project of the Year award under the country deal awards category of The Triple A Asia Infrastructure Awards 2019 presented by Hong Kong-based financial publication The Asset.

The Triple A Asia Infrastructure Awards 2019 Transport Deal of the Year, meanwhile, went to the Cebu Cordova Link Expressway Corporation P19-billion financing, in which DBP was one of the arrangers.  The 8.5-kilometer toll bridge project aims to ease traffic congestion between the rapidly developing areas of Cebu and adjacent Mactan island and is projected to serve at least 40,000 vehicles daily while providing additional access to the Mactan Cebu International Airport.

To help boost the National Renewable Energy Program, DBP provided the needed financing for a 22.326 MWP solar power plant of Enfinity Philippines Renewable Resources, Inc. (EPRRI) as part of the development of the Clark Green City under the National Government’s “Build Build Build” infrastructure program.

The power plant currently provides an alternative power supply to the growing energy requirements of around 40,000 to 100,000 households and establishments within the area, producing 19.8 MW of solar power, which constitutes 10% of the area’s energy needs.

DBP’s solar power plant venture with EPRRI was adjudged the most outstanding project for environmental development by the ADFIAP Development Awards for projects that have created a development impact in their respective countries.

The bank’s peace and economic inclusion advocacy, especially in Mindanao, continues to expand in close partnership with the Office of the Presidential Adviser on the Peace Process (OPAPP).  Along with the overall fund management of OPAPP resources which are earmarked for the various socio-economic programs of the agency, DBP is poised to assist in ensuring food security by providing financing assistance for farming organizations in the Bangsamoro Autonomous Region in Muslim Mindanao.

Expanding support to priority sectors

Overall, in 2019, DBP broadened funding support to priority sectors, disbursing P329.1-billion in loans to borrowers as of the third quarter of last year, a significant 33.8 percent increase from the P246-billion recorded during the same period last year.

The bulk of the bank’s loan portfolio went to the infrastructure and logistics sector which accounted for nearly 40 percent of loan releases or P152-billion, followed by loans to social services (P67.33-billion), environmental projects (P44.6-billion), and micro, small and medium enterprises (P24.6-billion).

New Lending Programs

DBP also launched several new lending programs in 2019 including the Contract To Sell (CTS) Financing Facility for Real Estate Developers which assists developers in growing their housing portfolio through the bank’s purchase of receivables covered by a CTS.

DBP’s Lending Initiatives for Sanitation (LINIS) program assists private companies, water districts, cooperatives, and local government units in developing their water treatment and sanitation facilities to comply with existing environmental regulations.

The Distributor and Dealers Financing Program supports the development and promotion of small enterprises in areas with distinct ecosystems of sellers/ suppliers, distributors/ dealers, and retailers that are linked in a supply or value chain of a specific brand of product or group of products.

Corporate Social Responsibility

In 2019, the bank sustained implementation of the DBP Forest Project which is aimed at restoring forest cover in the country.  DBP collaborated with forest partners such as government and non-government organizations, state universities and colleges, and people’s organizations, in reforesting open and denuded areas through the planting of fruit-bearing and forest trees, mangroves and other useful species.

DBP shouldered the cost of planting stocks, project maintenance, and operating expenses.  Forest partners contributed through the maintenance and protection of the plantations, project monitoring, and other forms of sweat equity.

Currently, there are 45 DBP Forest projects across the country with a total land area of more than 7,000 hectares; 5,664 of which have been planted with more than 5 million trees.  In 2019, DBP Forest projects in Davao City provided additional source of income to beneficiaries consisting of farmers, fishermen, and their families.

In 2008, to promote sustainable economic inclusion in the education sector, the DBP Endowment for Education Program (DEEP) was launched with a P1-billion fund to support 10 batches of indigent Filipino college students.  DBP’s assistance covered the whole range of scholars’ requirements, including tuition and student support.

As an off-shoot of DEEP, the DBP Resources for Inclusive and Sustainable Education (DBP RISE) started in 2018 with a P500-million fund for scholars enrolled in courses needed in the construction industry in support of the National Government’s infrastructure build-up program.  The bank signed a memorandum of agreement with 14 partner schools last year for the implementation of the DBP RISE.

As of the third quarter last year, 3,170 out of 3,375 DEEP graduates are now gainfully employed by local and global employers in the industries of their specialization.  Meanwhile, DBP RISE is supporting its first two batches of scholars comprised of 719 students.  The bank aims to support 2,500 scholars through the DBP RISE.

DBP has likewise undertaken a partnership initiative with the Department of Education’s Adopt-A-School Program with Lydia Aguilar National High School, one of 12 public high schools in Las Piñas City, as beneficiary.

Under the program, DBP has donated school supplies/ kits, as well as various equipment including desktop computers, smart televisions, and a water tank, to benefit the school’s estimated student population of more than 1,700 as of end 2018.

With 129 branches, 11 branch lite units, 22 lending centers, and 836 ATMs nationwide, DBP will continue with its drive to promote economic inclusion and remain a relevant and responsive partner of the National Government in promoting sustainable development, particularly in the countryside.

Click here for the DBP Anniversary Supplement 

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