Phl has best microfinance framework
By Ted P. Torres (The Philippine Star) Updated June 10, 2012 12:00 AM
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Manila, Philippines - The Philippines has the best policy and regulatory
framework for microfinance in the world, according to the Economic
Intelligence Unit (EIU).
The EIU is a global consultancy and research outfit that helps business
leaders prepare for opportunity, empowering them to act with confidence
when making strategic decisions.
Bangko Sentral ng Pilipinas (BSP) Monetary Board member Ignacio R. Bunye
said one of the key reasons for the distinction is the existence of a
regulator that issues supportive and enabling policy as well as capacity
building regulations.
"Our main approach as been, and will continue to be, to facilitate the
delivery of commercially sustainable microfinance products and
services," Bunye said during awarding ceremonies of the Rural Bankers
Association of the Philippines – Microenterprise Access to Banking
Services (RBAP-MABS) program.
A few years back, the BSP was recognized as the only central bank that
was encouraging the practice of microfinance to the private sector.
Bunye said the BSP studied microfinance extensively, resulting in
regulations and best practices such as using group support or liability
arrangements, cash flow-based lending, and high frequency amortization.
The BSP relaxed some regulations regarding branching for rural banks
practicing microfinance. That included the establishment of
micro-banking offices (MBOs).
Due to its positive attitude towards microfinance, the BSP held talks
and discussions with the private sector for the type of regulations
needed to boost the sector.
At the same time, the regulator instituted prudent standards for the
conduct of microfinance operations by prescribing the use of
portfolio-at-risk to monitor and measure portfolio quality, in the
context of risk-based supervision.
"This approach has allowed bank supervisors to fully understand the risk
profile of microfinance," Bunye added.
He pointed out that from the crude micro-loans, microfinance advocates
from the public and private sectors created such schemes as
micro-deposits, microinsurance, micro-agriculture, housing microfinance
and microfinance plus.
From transactions that required the personal presence of the
microborrower in bank branches, micro transactions can now be done
through short message system or text messaging.
Last data indicate that there are four million families that have been
responsible for making microloans reach P41 billion.
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CARLOS ANI - International Microfinance Consultant - SEEDFINANCE Corporation Chairman
Mailing address: PO Box 90 UPLB Los Banos Laguna, Philippines 4031
Emails: carlosani@gmail.com , carlosani@seedfinance.net
Landline Phone: +63495010127 (PLDT)
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http://phildevfinance.blogspot.com
Family website - http://www.anifamily.net
SEEDFINANCE Corporation - http://www.seedfinance.net
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