MANILA, 24 July 2018 – CIC President and Chief Executive Officer Jaime Casto Jose P. Garchitorena emphasized the importance of information and creditworthiness resulting to trustworthiness in acquiring loans during the National Microfinance Panel Discussion with the theme “Policies and Strategies Needed to Bring Microfinance to the Next Level”.
As one of the initiatives under the annual Philippine Social Enterprise Month (PSEM) in July, Senator Paolo Benigno “Bam” Aquino IV and the Benita and Catalino Yap Foundation (BCYF) organized the panel discussion held at Ballroom 1 AG New World Hotel Manila Bay, Malate, Manila.
Introducing CIC, PCEO Garchitorena said that credit scoring protects both the lender and the borrower, the latter from being over indebted.
Misamis Oriental Representative Peter Unabia, Chair of the Committee on Small Business and Entrepreneurship Development, stated the need for legislators to institutionalize policies in protecting the borrowers. He focused on the current regulations which need to improve operational inefficiencies.
Edgardo C. Amistad, BCYF Board of Trustees Member & President at UCPB–CIIF opined the tendency for the microfinancing institutions to become rich while the poor do not. Improving the microfinance industry’s operational procedures will lower down expenses similarly the interest rates being passed on to lenders.
Technology was considered to be a solution in lowering down the interest rates. Marilyn M. Manila, Director, CARD Bank, Inc., emphasized the need to digitize client service. The industry can embrace the technology by using mobile devices however, internet connectivity is a challenge. Data is expensive in the Philippines, mothers as the main clients of microfinance, are not technology savvy while there are issues on cyber-technology happening to big banks. As per Ellen Joyce L. Suficiencia, Acting Deputy Director of Inclusive Finance Advocacy Office, Bangko Sentral ng Pilipinas, programs on digital finance have been developed. Money transfers are now allowed through stores, groceries or cellphones making the transactions cheaper and convenient to the public.
In support, CIC PCEO Garchitorena explained that taking the basics of 5-6 lending system: location as access to the borrower and daily collection process, technology can definitely come in through mobile alerts and easy payment schemes. On the other hand Development Bank of the Philippines, as an assistance to the public, has fixed the interest rates to only 9% for two years according to Paul V. Lazaro, DBP First Vice President.
Senator Bam Aquino said 5-6 is not the only alternative. He advised the public to consider the microfinance industry. “It is important to promote MSMEs as partners in nation building to have a sustainable economy, Aquino concluded. His Go Negosyo Act was passed to strengthen the MSMEs through creation of jobs and business opportunities.
The panel comprised of Congressman Unabia and officials from Bangko Sentral ng Pilipinas, Development Bank of the Philippines, Asian Development Bank, Board of Microfinance Council of the Philippines, Small Business Corporation, Small Enterprises Research and Development Foundation, CARD Bank, BCYF and Credit Information Corporation.