Asian countries have their own strategies to tackle economic change. Philippines, one of the countries in SouthEast Asia can adapt with economic and environmental change by instigating sustainable finance. However, it is not easy to implement Philippines sustainable finance.
A country must require experts to determine best strategies in applying sustainable finance. It will become a long-term investment that will bring sustainable economic projects and activities. Covid19 pandemic makes some industries and governments to initiate sustainable finance for better economy.
Why Is Financial Sustainability So Important?
Covid19 outbreaks indeed affect many aspects, economy in particular. The Philippines decides to focus on sustainable finance to enhance economic growth in this country. Financial sustainability is really crucial to increase economic growth since it has some benefits.
With financial sustainability, the investment is long term so it will reduce expenditure, minimize resources usage and save operational cost. It makes sense that sustainable finance is more efficient in spending resources. It even increases profit at the same time.
Balanced Economic Growth
Fundamentally, financial sustainability refers to investment that considers the welfare of society, environment, and government while executing economic projects. It ensures balanced economic growth globally and nationally.
Expands Business Opportunities
Since financial sustainability highlights the well-being of the economy and environment, the investment tends to go on long term. Normally, the long-term investment will lead to futuristic business opportunities for all stakeholders.
Actually, sustainable finance can minimize social and environmental risks. It is one of the benefits that come in the short or long term. The basic concept of sustainable finance is to restore nature, unlike the conventional investments that tend to not to exploit nature.
Roadmap of Philippines Sustainable Finance
In order to implement sustainable finance, the central bank in this country, BSP (Bangko Sentral ng Pilipinas) works on some projects that emphasize the eco-friendly economy. Thus, the Philippines establishes a roadmap that brings advantages for private and public sectors.
The government provides preventive measures and solutions for stakeholders in applying financial sustainability by rearranging regulation about tax rates and fiscal policies to prevent economic, financial and environmental harms.
Currently, online transactions and e-money has become an area of interest in applying Philippines financial sustainability. From 2014 to 2018, e-money transaction’s growth rate was 8%. Apparently, with the popularity of digital wallets, the growth rate of e-money increased up to 15%.
E-money transactions keep increasing since the compound annual growth rate reaches 36% from outflow, inflow and usage of e-money.
Thus, e-money will become prominent in sustainable finance in the future. Mobile wallet and prepaid cards are examples of e-money adoption in emphasizing sustainable finance.
Digital Investment Applications
With e-money, the transaction becomes cashless and paperless. It surely brings a positive impact toward financial sustainability because this transaction can reduce carbon footprint. Aside from mobile wallets, some applications offering digital investment for consumers start to emerge.
These platforms strengthen the government’s initiative in implementing sustainable finance and lead citizens to actively participate in sustainable finance projects. By doing so, the Philippines will easily achieve the goal of financial sustainability.
To actualize Philippines sustainable finance, the government and financial institutions keep on promoting financial sustainability. It certainly requires an active role from the private and public sectors. Recently, the development in sustainable finance has grown well. It will grow higher in the future.