Study shows SMS Reminders Boost Ontime Loan Payments

January 21, 2012 By Leave a Comment

Professor Dean KarlanInnovations for Poverty Action (IPA) led by Professor Dean Karlan of Yale University, in partnership with United States Agency for International Development-supported Rural Bankers Association of the Philippines-Microenterprise Access to Banking Services (RBAP-MABS) Program,  conducted a study to test the effectiveness of using text messages (SMS) for loan payment reminder. Updates on this study were shared with RBAP-MABS on January 20, 2012.

In partnership with two RBAP-MABS participating banks, Green Bank Inc. and the Rural Bank of Mabitac, IPA studied the impact of SMS reminders with 1,259 first time borrowers. The study was designed to investigate the importance of the SMS’s timing, framing and personalization of reminders sent to borrowers.  For a period of sixteen (16) months between January 2009 and April 2010, 840 randomly selected loan clients received SMS reminders in their local dialect reminding them to pay their loans.

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RBAP-MABS Participating Banks Mark New Milestone in Microfinance

January 20, 2012 By Leave a Comment

The Rural Bankers Association of the Philippines-Microenterprise Access to Banking Services (RBAP-MABS) Program was launched in 1997. The Program – supported by the United States Agency for International Development (USAID) and the Rural Bankers Association of the Philippines (RBAP), with oversight provided by the Mindanao Development Authority – assists rural banks to develop the capability to profitably provide financial services – microloans, microdeposits, microinsurance, and remittances – to the microenterprise sector. During its fourteen years of operation, the Program has also introduced innovations, both in delivery channels by pioneering and expanding mobile phone services and in helping rural banks to develop new microfinance products to serve small farmers (through the micro agri-loan product) and finance construction and housing improvement (through housing microfinace products).

Since 1997, the Program has worked with over 120 banks with more than 1,300 branches and other banking offices in the developing microfinance products, including microloans, microdeposits, micro-agri lending, housing microfinance, mobile banking, and microinsurance. These initiatives have allowed MABS participating banks to expand and offer new microfinance products and services to their clients.

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Tanzanians Take a Closer Look at Microfinance in the Philippines

January 19, 2012 By Leave a Comment

CRBD of Tanzania during their visit at Bangko Kabayan, Inc.

In partnership with RBAP International Study Visit Program, The United States Agency for International Development-supported Rural Bankers Association of Philippines– Microenterprise Access to Banking Services (RBAP-MABS) Program organized an international study group for representatives of the Cooperatives Rural and Development Bank Microfinance Services Company Ltd. (CRDB) of Tanzania on January 18, 2012.

CRDB Microfinance Services Company Ltd., a subsidiary of CRDB Bank Plc, offers wholesale microfinance services by providing tailor made products and services that address financial needs of different communities in Tanzania. Moving forward, they plan to go into retail microfinance and design more catered products reaching the formerly ‘unservable’ market niche. The visit aims to obtain lessons learnt from rural banks in implementing microfinance, microinsurance and mobile phone banking. This would eventually align their outreach strategies together with technological advancements, knowledge of specific market segment and continuous development of internal capacities to achieve maximum impact to businesses and the communities they serve.

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BSP raises ceiling on micro-credit

January 5, 2012 By Leave a Comment

Business World - THE BANGKO Sentral ng Pilipinas (BSP) has raised the existing cap on microfinance loans to allow banks to provide more financing to clients.

In Circular No. 744 dated Dec. 28 and posted on its Web site yesterday, the BSP added “microenterprise loan plus” or “microfinance plus” to the types of microfinance loans that banks may extend to their clients.

Whereas microfinance loans are capped at P150,000, the microenterprise loan plus or microfinance plus are capped at double that or at P300,000.

“We created the microfinance plus concept in recognition of the success of a growing number of microenterpreneurs,” said BSP Deputy Gov. Nestor A. Espenilla, Jr. in a text message yesterday. “They need bigger loans.”

Pia Roman-Tayag of the BSP’s Inclusive Finance Advocacy Staff, said the P300,000 limit is still less than what traditional banks offer.

She said those who need the bigger loans have been “largely unserved.”

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Virtual Conference: Understanding Multiple Borrowing and Avoiding Over-indebtedness Among Clients

December 20, 2011 By Leave a Comment

On January 12-13, CGAP, IFMR and MicroSave will host a virtual conference to discuss thoughts and experiences around multiple borrowing and avoiding over-indebtedness. Moderators will be facilitating online discussions on a variety of topics, and we are inviting you to participate.

Discussions will focus on the following topics:

Day 1: Multiple Borrowing – Definition, Concepts and Region

  • Issues around and causes of multiple borrowing and over-indebtedness;
  • Commercialization of microfinance

Day 2: Addressing Multiple Borrowing and Client Protection

  • Mitigation strategies adopted by institutions across the globe and how we can learn from cross-sharing;
  • How funding and training institutions are addressing challenges;
  • Client protection in the context of multiple borrowing and over-indebtedness.

You must register in advance in order to participate in the conference. Click here to register.

Should you have any questions regarding the upcoming virtual conference, please contact Erin Scronce of CGAP at the following email address: escronce@worldbank.org

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