P11.7-B poured in Mindanao for micro lending

The loans, within the range of P5,000 to P150,000 and average of P10,000 per borrower, were accessed by poor households from micro finance institutions in Mindanao that lent money from the PCFC.


The "poorest of the poor" in the Autonomous Region in Muslim Mindanao (ARMM) got the smallest part of the P11.7 billion pie with only 3.5 percent or P414 million compared with Northern Mindanao’s 28% or around P3.2 billion.


Southwestern Mindanao came in second with P2.6 billion, Caraga region third with P2.5 billion, Southeastern Mindanao fourth with P1.7   billion,  Western Mindanao fifth with P1.18 billion, and ARMM  with P414 million.


The top five provinces that received the highest amount of loans to the poor were South Cotabato (P1.35 billion), Misamis Oriental (P1.16 billion), Bukidnon (P977 million), Agusan del Norte (P858 million) , and Davao del Sur (P800 million).


The provinces that received the least  were Camiguin (P21 million), Tawi-tawi   (P42 million), Lanao del Sur (P55 million), Sulu (P64 million) , and Basilan (P86 million).   Borrowers from cities were computed with the figures in the provinces where they came from.


Only 15,005 or 6 percent of the total number of poor households in the region pegged at 246,731 were able to access the loans making ARMM the lowest in Mindanao in micro finance access coverage at 11.4 percent.


Of the five ARMM provinces, 42% of those who got microfinance loans were from Sulu; 31% from Maguindanao; 11% from Tawi-tawi, 10% from Lanao del Sur and 6% from Basilan.


But Mindanao’s  P11.7 billion is only 28 percent of the P42 billion micro finance capital released in the country from July 2004 to March 2006,  PCFC figures showed,


Erwin Idong, PCFC assistant vice president told MindaNews that  the presence of micro financial institutions (MFIs) in the area is a major factor in reaching more clients.


Idong, other  officials from government-owned corporations and financial institutions that lend capital to the MFIs, were in Davao to speak to lenders on delivering micro finance services to the poor in "hard-to-reach" areas.   


In 2003, of the 721 branches of MFIs in Mindanao, only 33 or 4.6 percent were in the ARMM. The Caraga region, composed of the two Agusan and two Surigao provinces had the most number of  MFIs with 174 or 24.13 percent. There were 154 MFIs in Northern Mindanao where a total of P3.2 billion capital was released. Around 131 MFIs served in Southeastern Mindanao, 119 in Southwestern Mindanao and 110 in Western Mindanao.         

“That is why we are urging big and established MFIs  to invest in the ARMM,”  Jeffrey Ordoñez, executive director of the MMC, told MindaNews. The MMC plans to extend loans to around one million poor households in hard-to-reach areas, especially in the ARMM, by 2010.  


He said they have reached some 400,000 poor households in Mindanao.


Indong noted the Philippines has no problem with capital in micro finance with  loans from the World Bank and the Asian Development Bank. "The bigger problem is the capacity of the MFIs' delivery mechanism to extend micro finance services to the poor," he said.


MMC,  Ordoñez said, has embarked on a capability-building campaign to aid MFIs in harnessing the markets in their areas. (Walter I. Balane/MindaNews)