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INNOVATIONS
IN MICROFINANCE
conference on microfinance
July 24 - 25, 2008 * Asian Development Bank, Manila, Philippines
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In previous years, wholesale loan funds for retail microfinance institutions in the Philippines were largely provided by
government financial institutions such as People’s Credit and Finance Corporation, Land Bank, Small Business Corporation
and the Development Bank of the Philippines. Lately, a few commercial banks have designed and opened a window for
MFIs to access wholesale loan funds. While these banks are ready and able to do a respectable volume of business with
MFIs, the loan applications and actual volume of loan releases remain way below the expectations of the banks. The session
will deal on the early experiences of two commercial banks that have loan windows for retail MFIs. Representatives of the
two banks will discuss the challenges they have experienced at the field level, including insights, learnings and peculiarities
of doing business with MFIs.
Resource speakers: Facilitator:
Josaias T. Dela Cruz Edgardo Garcia
Vice President for Microfinance, BPI Microfinance Council of the Philippines, Inc.
Remigio Tito C. Tirones, SVP & Group Head, Documenter:
SME Banking Group, Planters Development Bank Laila Deles, Pinoy ME
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• Over 34M (40%) of our
population live below the
poverty line
Why Microfinance?
Why Microfinance?
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Over the last 25 years,
microfinance in the Philippines
has doubled every 5 years
into a P7B industry.
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Philippine MFIs and Outreach
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What is the Scope of
Microfinance today?
• Microenterprise Loans
Why Microfinance?
• Savings Products
• Micro Insurance
• Remittance / Funds Transfers
• Micro Agri Loans
• Housing Microfinance
• Alternative Energy Loans
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Current supply in the Philippines is only
reaching between 10% to 20% of market
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Q: What is BPI
Microfinance?
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• BPI was the first private
commercial bank to lend to
MFIs in the 1980s
• BPI is the first private KB to
mainstream MF into its core
business
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Wholesale Institutional Loans
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Developmental Capacity-building Soft Loans
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Capacity Building
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Capacity Building Loan
RB Eligibility Requirements
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Business Advisory & Operations Solutions
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Institutional Partnerships
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BPI Microfinance Unit
9th Floor, BPI Head Office
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Planters Development Bank
Microfinance
Emerging Partnerships
Corporate Background:
Corporate Background:
•Nationally acclaimed as the Bank for Small and
Medium Enterprises (SMEs)
•Consistent recipient of various awards and citations from
the country’s program agencies on SMEs
•One of three banks worldwide to pursue Double
Bottom Line Banking (Harvard Study)
•72 Nationwide Branches (9 were opened in 2006)
Planters Development Bank
Microfinance
Experience
Planters Development Bank
Objectives:
To better serve as a conduit of funds via wholesale
credit to the MFIs
Target Clients:
The Wholesale Microfinance Facility is marketed among:
¾ Microfinance Institutions (MFI’s)
¾ Rural Banks
¾ Cooperative Banks
Product Features:
Product Features:
• Manner of Release: in tranches; via drawdown based on submitted
Certified List of Sub-borrower's PNs
Challenges:
1. Compliance with Accreditation and Pre-approval
Requirements
Point person for MFI (e. g. President, Exec. Dir., Compliance Officer,
Microfinance Head, etc.)
Due diligence (e. g. field visit, desk review, interview with MFI and clients, etc.)
Challenges:
2. Utilization of Approved Credit Line
Interest rate
Documentary requirements
Planters Development Bank
Challenges:
3. Drawdown
Documentary requirements
Issuance of PDCs
Planters Development Bank
Challenges:
4. Renewal of Microfinance Wholesale Facility
Documentary requirements
Interest rate
Repayment
Planters Development Bank
WHY PLANTERSBANK?
• Proven track record
• Premium service
• Branch network
Planters Development Bank
• Loan Term
• Collateral requirements
Potentials:
¾ Product development to address the needs of MFI’s
Planters Development Bank