DAVAO CITY-- As learned from past experiences, lending money to the poor is not the way to go to eradicate poverty.
From this line of thought, the Microfinance Council of the Philippines, Inc (MCPI) is now promoting for the development of social empowerment program and not just economic.
MCPI gathered that the standard micro-enterprise loan was not reaching the poorest and that MFIs need to continue exploring new products and services.
MCPI president Ruben de Lara cited some of the practices of MFIs actively implementing social empowerment programs such as the provision of medical insurance to members of the MFI.
Here, the Tulay sa Pag-Unlad Inc partnered with the government to provide medical insurance to its members. With a mere P1,200 the whole family of the member is now covered, he said.
Another program that MFIs are encouraged implement is the social housing program that allows members to borrow from P30,000 to P100,000 for housing purpose. They are only charged 1.2 percent interest per month, way too lower than the livelihood loan portfolio that the MFI provides.
Other social empowerment services include educational loan, trainings, and exposure to value formation. These are but some of the pro-poor products, services which are both financial and non-financial in nature.
Nationwide, there are around 46 Filipino institutions members of MCPI, striving to attain and maintain certain standards of practice for the welfare of their clients, the sustainability of their operations and eradication of poverty in the Philippines.
In Mindanao, there are about 41 MFIs delivering financial and capability development services to the poor.
Data showed that there is a collective outreach of 1.5 million clients and total portfolio of 7 billion as reported in 2008.
As the number of sustainable MFIs increase, the industry is making its significant contribution in effecting a stable and more equitable financial system in the country. (PIA XI/Mai Gevera)