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October 3, 2005 |
 As part of its efforts to complement the government’s initiative of spurring the growth of the micro-enterprise sector, the Development Bank of the Philippines (DBP) released P33.8 million in total loans to three participating conduit microfinance institutions (MFIs) during a stakeholders’ forum on microfinance held last September 19 in Malacañan Palace.
President Gloria Macapagal Arroyo witnessed the ceremonial awarding of checks representing DBP’s microfinance loan releases to the Center for Agriculture and Rural Development (CARD) Inc., (P30 million), BMS Rural Bank (P1.94 million) and First Macro Bank (P1.901 million).
DBP President and CEO Reynaldo G. David said these loan releases demonstrate that microfinance remains a significant development strategy for the Bank as it endeavors to contribute to the empowerment of disadvantaged sectors in the fight against poverty.
A non-stock, non-government organization that has been in the microfinance business for the past 18 years, CARD was ranked sixth best microfinance institution in the global microfinance category for outreach and sustainability by the Consultative Group to Assist the Poorest (CGAP) of the World Bank in 2003.
BMS Rural Bank, Inc., on the other hand, has been operating for the past 40 years. Its microfinance program includes livelihood loans, consumption and emergency loans, deposit generation and insurance and pension benefits.
One of the top rural banks in the country, First Macro Bank has been perennially cited by the DBP for being an active microfinance partner in energizing the growth of mSMEs.
Job Generation
With the theme, “Harnessing Microfinance for Job Generation and Entrepreneurial Growth,” the forum brought together microfinance stakeholders to increase people’s awareness of available and forthcoming microfinance services, raise pertinent concerns, suggest actions to deal with issues, and promote stronger partnerships. It was also held on the occasion of President Arroyo’s proclamation of 2005 as Microfinance Year of the Philippines.
In her keynote speech, President Arroyo underscored the importance of microfinance in generating jobs and spurring the growth of entrepreneurship nationwide. She also reported that from July 2001 to May 2005, the government has provided some P20.79 billion microcredits to 2.17 million borrowers nationwide.
Microfinancing is a component of the job generation program of the administration’s 10-Point Agenda embodied in the Medium-Term Philippine Development Plan. The government is eyeing half-a-million microfinance clients every year, which should translate to at least three million new jobs in six years.
The government’s microfinance program involves the extension of credit to poor and low-income households for as low as P2,000 non-collateralized loans to as much as P150,000 at competitive interest rates, and the conduct of intensive social preparation and training of borrowers. The government is the single biggest provider of microfinance through wholesale lending of government financial institutions (GFIs) to accredited MFIs such as banks, NGOs and cooperatives.
Financing Program for Micro-Enterprises
The forum also highlighted the Bank’s Financing Program for Micro-Enterprises during a panel discussion held after the ceremonies.
In her presentation, EVP Elizabeth Ong, head of DBP’s Program Development Group, reiterated the Bank’s commitment to microfinancing. “I’m sure this is not an easy task — being a bank, we have been used to the discipline of credit. But at this point, we are re-stating our commitment to microfinance. And with that commitment, we are putting our money where our mouth is.”
EVP Ong added that the Bank has administered about P9 billion in funds to assist the financing needs of mSMEs, including micro-enterprises. She likewise stressed that under the microfinancing program, the Bank has made available several windows to serve the specific funding needs of micro-entrepreneurs engaged in manufacturing, agri-businesses, and similar livelihood projects.
DBP currently has 37 accredited MFIs all over the country under its Financing Program for Micro-Enterprises. These MFIs include rural banks, cooperative banks, thrift banks, development banks, commercial banks, savings and loan associations, non-government organizations, credit unions, and cooperatives.
President Gloria Macapagal Arroyo congratulates BMS Rural Bank president Melchor Dantes Santos after receiving a microfinance loan assistance as DBP President and CEO Reynaldo G. David looks on.
CARD chairman Dr. Jaime Aristotle Alip receives their P30 million DBP loan assistance.
First Macro Rural Bank president Reginald Ocampo accepts a P1.901 million loan assist.
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