SOMETIME in the mid-80s, news about what (now Magsaysay awardee) Mhd Yunus and his Grameen Bank were doing started filtering back here.
From what I gather from talks I had with several people in the late 80s, interest about how such a venture could be set up here had piqued the curiosity of different people. One of them, if I remember, was Bruce Tolentino, then an Undersecretary or Assistant Secretary at the Department of Agriculture.
Without my realizing it, one other agency in government decided to get off the high horse and put up a similar program, albeit, with local flavor.
Remember my previous blog post about one of my favorite people, the late Mamita Pardo de Tavera? Well, it seems that the Department of Social Welfare and Development had already begun to explore the possibility of bringing the Grameen concept over here, minus the trappings of a bank. When the good woman transferred to the Philippine Charity Sweepstakes Office (PCSO) to serve as its chairperson, she brought along with her a trusted Undersecretary, Linda Valenzona, plus a coterie of trained social workers. Me, I only had toyed with the concept, and like a typical alpha male, kept mulling the idea over and over in my mind. These women did what I believe many women are best at: They just went ahead and did it. So, while drawing up the parameters for the online lottery project, I kept looking over my shoulder to see what these busy women were doing in this new field of microfinance.
The group in the PCSO set up a small fund in low nine figures — a much more intelligent and beneficial project than those blasted ambulances that almost never got used as ambulances — as a seed fund. The social workers were trained especially to work with poorer people in the rural areas. The basic model of using groups of five was retained, with each group or different sets of fives placed under a sponsoring NGO. The NGOs took over the task of training, monitoring, following up, etc.
Basic accounting skills and fundamental knowledge of banking procedures followed. The end result? Linda and her group were happy to report to Mamita that the groups all managed to pay back, or, even with slight delays, paid in full. And the amounts given out for projects were typically Grameen-sized: very small. Happiest were the NGOs when they were told that they could recycle the funds into new groups of five but with the provision that the present groups they were working with would serve as trainors.
I bumped into present PCSO chairperson Serge Valencia a couple of months back in birthday party of a mutual friend. When I asked him, he said they were not running the project anymore. He was surprised to learn from me that the social workers brought over by Mamita were still there, and could mobilize in an instant. I wonder if he will take the cudgels for this project.
November 27th, 2007 at 10:06 am
PCSO, a “charity” sweepstakes office owned and run by government, can never be a sustainable microfinance institution. People will always have a perception of PCSO that will militate against a more commercial, market-oriented, financial relationship between “lender” and its “poor customers”.
November 27th, 2007 at 9:26 am
My son a councilor is very concerned about the many poor in our city of Navotas and believes that Microfinance is a powerful tool to help them based on the story of Dr. Yunus and his Grameen Bank. Plus it is now a US$9B industry that includes Citigroup and other giant banks as participants. We want to introduce this in our city and we need help. Could you help us out. Advise, leads and information will be a big help.
Thank you very much.
November 27th, 2007 at 8:36 am
From my view, the beginnings of microfinance intitutionalization in this country was in College, Laguna sometime in the early 70’s when Nobel Laureate Muhammad Yunus whose brainchild is now known as Grameen Banking was attending meetings as a member of the IRRI (Int’l Rice Research Inst.) Board of Directors. My college buddy, Dr. Generoso Octavio, under the guidance of Dr. Yunus, started a successful pilot research project using the classic Grameen Banking Approach which became institutionalized as Ahon Sa Hirap, Inc. (ASHI) with offices at 76 Eight Ave., Cubao, Quezon City. This is the pioneering microfinance NGO in the Philippines, now with more than 25,000 members, 130 staff in 14 branches nationwide and a loan portfolio of more than P220 million. All this started with 5 mothers taking credit of P1,000 each and dutifully assumming resposibility for their economic development. Some 2000 of these beneficiary members are on track to become millionaires. Their success are literally dramatic rags to riches stories, which should inspire anyone who hears about it through your newspaper and other media. Then all the nation will know the gospel to the poor is indeed being preached in the country.