For more than a decade, financial inclusion has been framed as a problem of access. Open an account. Digitize payments. Bring people into the system. By those standards, the Philippines appears to be a success story. Mobile wallets are widespread. Digital banks are growing. Government cash transfers and remittances increasingly move through electronic channels. Yet beneath this progress lies a stubborn and unsettling truth. Access has expanded, but empowerment has not.
This contradiction lies at the heart of the Atlantic Council’s recent report, “A Three-Billion-Person Challenge: Decision Time for Financial-Sector Leaders.” The report argues that roughly three billion economically active adults already have financial accounts but do not meaningfully use them for formal savings, credit, or insurance. The gap is no longer about connectivity alone. It is about trust, affordability, relevance, and governance. Viewed through a Philippine lens, the report reads less like a distant global diagnosis and more like a precise description of our own financial reality.
THE 3B-PERSON CHALLENGE, PHL EDITIONThe Philippines mirrors the report’s central paradox almost perfectly. Access is no longer the problem. Usage is.
The country has high financial account penetration, driven largely by mobile wallets, digital banks, and the digitization of government cash-transfer programs. Filipinos are among the heaviest users of digital payments in Southeast Asia. Paying bills, transferring money, and receiving remittances through apps has become routine.
Yet beyond payments, participation thins out quickly. Formal savings remain shallow. Formal credit is limited. Insurance penetration is weak, especially outside salaried urban workers. In short, Filipinos can pay digitally, but they cannot easily build financial resilience.
This places the Philippines squarely inside the “three billion” group described in the report. These are not the excluded or the disconnected. They are economically active households who have entered the system but do not fully trust or benefit from it.
Who are the “three billion” in the Philippine context?
In Philippine terms, the three billion are not abstract. They are micro-entrepreneurs running sari-sari (sundry) stores, online reselling operations, transport services, and home-based businesses. They are gig and platform workers whose incomes fluctuate week to week. They are women household managers juggling care work, microbusinesses, and informal savings. They are families of overseas Filipino workers receiving remittances but lacking tools to convert inflows into long-term security.
They have a mobile phone. They have a wallet or bank account. They have some cash flow.
But they still rely on informal lending, paluwagan*-style savings, and emergency borrowing at punitive rates. Their financial behavior is not backward. It is cautious. It reflects lived experience with systems that feel fragile, opaque, and unforgiving.
WHY PINOYS DON’T FULLY USE FINANCIAL SERVICESThe Atlantic Council report identifies several structural barriers to usage. In the Philippine context, these barriers are not theoretical. They are encountered daily.
First, connectivity is uneven, not absent. Mobile penetration is high, but network reliability and data costs still disrupt usage, particularly in provincial and island communities. Dropped connections during transactions are not minor inconveniences. They undermine confidence. When money disappears mid-transaction, trust erodes faster than any awareness campaign can repair.
Second, affordability is the real deal breaker. Filipinos are extremely price-sensitive. Hidden fees, unclear charges, and transaction costs that feel negligible to banks loom large for daily wage earners and micro-entrepreneurs. Women are especially affected, consistent with the report’s finding that affordability is a gendered issue. In the Philippine context, fee opacity does not remain a technical concern. It quickly becomes reputational damage that spreads through word of mouth and social networks.
Third, trust is fragile and easily lost. This is where the Philippine lens becomes sharper than the global average. Filipinos already live with scam-heavy SMS environments, phishing through messaging apps, deepfake-enhanced fraud, and persistent anxiety over data privacy. Every scam story reinforces a simple belief: “Mas ligtas pa ang cash. (Cash is safer.)” Trust, as the report notes, is now infrastructure. In the Philippines, it is also reputation currency. Once spent, it is costly to rebuild.
Fourth, products do not match Filipino lives. Most financial products still assume predictable incomes, monthly repayment cycles, and formal employment. Filipino financial life is irregular, seasonal, family-centered, and shock-prone. When digital credit is available, it often delivers short-term relief at the cost of long-term stress, leading to over-borrowing and eventual disengagement. This cycle breeds not inclusion, but distrust of the system itself.
One reason this tension persists is that digital credit has become the most visible and, for many Filipino households, the most accessible entry point into formal finance. Mobile-first lenders have stepped into a space long underserved by traditional banks, extending small-ticket, short-term loans to borrowers without formal credit histories, collateral, or predictable incomes. By using alternative data and simplified onboarding, these lenders reach micro-entrepreneurs, gig workers, and women household managers who are often excluded by conventional underwriting models. In doing so, digital lenders offer a regulated alternative to informal lenders and emergency borrowing that typically comes with far harsher terms and no consumer protection at all.
Where digital lender’s potential becomes most relevant to the Atlantic Council’s argument is in its capacity to move borrowers beyond survival finance. Digital lending, when designed responsibly, can serve as a steppingstone toward financial agency rather than a revolving source of short-term relief. This means using credit not only to bridge cash-flow gaps but also to build data trails, improve creditworthiness over time, and introduce borrowers to more appropriate financial products as their needs evolve. In a trust-fragile environment like the Philippines, lenders that invest in transparency, borrower understanding, and humane engagement do more than extend loans. They help normalize formal finance as something that works with, rather than against, the realities of Filipino household life.
WHY THIS MATTERS FOR PHL GROWTHThe report’s macroeconomic logic lands hard in the Philippines. Micro, small, and medium enterprises account for more than 99% of businesses, yet face chronic financing gaps. Women-led enterprises remain underfinanced despite evidence of strong repayment behavior. Remittances remain largely consumption-heavy instead of investment-oriented.
The Philippines is not underbanked. It is under-empowered.
Unlocking appropriate savings, credit, and insurance for this segment is not merely social policy. It is economic strategy. Financial inclusion that fails to build resilience weakens productivity, limits enterprise growth, and amplifies vulnerability during shocks.
WHAT PHL HAS AND WHAT IS MISSINGThe report places strong emphasis on digital public infrastructure, particularly the combination of digital identification, instant interoperable payments, and consent-based data sharing. The Philippines has made progress. A national digital ID system is emerging. E-wallet penetration is high. Fintech innovation is active. The central bank has generally taken a progressive posture toward digital finance.
What remains missing is equally important. True interoperability across platforms is incomplete. Clear, enforceable consent-based data-sharing frameworks are still evolving. Governance across finance, data privacy, artificial intelligence, and digital identity remains fragmented.
The report is clear on this point. Digital public infrastructure only works when all three pillars move together. Partial digitization creates risk, not trust. When systems advance unevenly, consumers bear the cost of complexity and exposure.
BEYOND ACCESS, TOWARD FINANCIAL AGENCYThe Atlantic Council report is right to frame this as a decision moment. But the decision is not simply about deploying the right technologies. It is about redefining what inclusion means.
For Filipino households, inclusion should mean the ability to withstand shocks without falling into debt traps, to grow small enterprises with confidence, and to trust that institutions will act predictably and fairly. Digitization can support these goals, but it cannot substitute for trust, transparency, and sound governance.
Beyond access lies agency. And agency, not connectivity, is the true measure of financial inclusion.
*Paluwagan is an informal community-based savings group.
Dr. Ron F. Jabal, APR, is the CEO of PAGEONE Group (www.pageonegroup.ph) and founder of Advocacy Partners Asia (www.advocacy.ph).
