The grant was originally designed to improve the rural financial system in the country with the cooperation of the Rural Bankers Association of the Philippines (RBAP), the Rural Bankers Research and Development Foundation, and the GTZ. Project partners are the Bangko Sentral ng Pilipinas (BSP), the People’s Credit and Finance Corp. (PCFC), Cooperative Development Authority (CDA), and the Cooperative Banks Federation of the Philippines (Bangkoop).
The program was known as the Development of Financial Institutions and Enabling Systems (Defines).
Upon the review by the NEDA, the National Government decided to review the program based on new priorities.
In a communiqué to the Federal Ministry for Economic Cooperation and Development, NEDA deputy director general Gilberto M. Llanto said the funds would instead be used for the Promotion of Private Sector Development or PPSD (originally known as the SME Promotion program).
Llanto said the NEDA will review the rural financial project and look into integrating this to the PPSD.
He said the government think-tank is looking to have the Land Bank of the Philippines (LBP) as the main program holder. The government financial institution (GFI) is heavy into countryside development and SMEs.
The proposal was made to ensure that the program would be consistent with the national government’s policies and priorities for the microfinance sector, in particular and countryside development, in general.