The Japan International Cooperation Agency (JICA) has recently launched the Credit Risk Database (CRD) Scoring Model in a joint effort with the Bangko Sentral ng Pilipinas (BSP) to help financial institutions to better assess the creditworthiness of small and medium-scale enterprise (SME) borrowers, including those without credit histories or adequate collateral.
The scoring model, which is the key output of the three-year Technical Cooperation Program between the BSP and JICA, is expected to provide banks with all the additional information that they need to assess an MSME’s creditworthiness.
Photo shows BSP Governor Felipe M. Medalla (fourth from left) while leading the launch of the Credit Risk Database Scoring Model. With him were (from left:) Monetary Board Member Peter Favila, JICA Philippines Chief Representative Sakamoto Takema, Japanese Ambassador to the Philippines Koshikawa Kazuhiko, BSP Deputy Governor Bernadette Romulo Puyat, and Deputy Governor Eduardo G. Bobier.
The launching ceremony was held at the BSP head office last April 25 and was attended by Japanese Ambassador Koshikawa Kazuhiko, JICA Philippines Chief Representative Sakamoto Takema, and officers of the 32 participating banks that voluntarily provided the data to build the CRD.
CRD scoring model to build funding gap, enhance credit risk management
According to BSP Governor Felipe M. Medalla, the CRD scoring model supports two objectives:
- Bridging the funding gap for micro, small, and medium enterprises; and
- Enhancing the credit risk management of financial institutions using a data-driven approach
During the project’s launch, the BSP chief also thanked the government of Japan and JICA for their unwavering support in the Philippines’ development efforts.
“Our positive stance on JICA’s continuous cooperation is grounded on our robust partnership and mutual trust to address the Philippine government’s priorities,” declared Sakamoto Takema, Chief Representative of JICA in the Philippines.
Japanese Ambassador Kazuhiko, for his part, said ensuring that promising SMEs have access to appropriate financing is essential to fully harness the Philippines’ economic potential and realize its goal of financial inclusion.
The banks that participated in the CRD project include Rizal Commercial Banking Corporation, Bank of the Philippine Islands, Metropolitan Bank and Trust Company, Philippine National Bank, Maybank Philippines, Asia United Bank, Security Bank Corporation, and Philippine Bank of Communications.
Also providing support to the program is the Land Bank of the Philippines, Development Bank of the Philippines, Philippine Business Bank, Sterling Bank of Asia, China Bank Savings, Malayan Savings Bank, Philippine Savings Bank, UCPB Savings Bank, 1st Valley Bank, Bangko Kabayan, Queen City Development Bank, Wealth Development Bank, Sun Savings Bank, AllBank, CARD SME Bank, First Consolidated Bank, Luzon Development Bank, Camalig Bank, Rural Bank of Paracale (Camarines Norte), Rural Bank of Pilar (Sorsogon), Rural Bank of San Mateo (Isabela), BOF, Inc., Lipa Bank, and Bangko ng Kabuhayan.
Representatives from the Department of Trade and Industry, the Bureau of the Treasury, the Securities and Exchange Commission, the Bankers Association of the Philippines, the Chamber of Thrift Banks, and the Rural Bankers Association of the Philippines were also present during the launch.