Impact evaluation of microfinance operations in selected areas of Laguna
Professorial Chair Lecture
UPLB Alumni Association Professorial Chair
Place
Department of Agricultural Economics, College of Economics and Management, UPLB
Abstract
Microfinance institutions, which provide the poor Filipinos the much-needed capital for their income-generating projects, found a niche in the Philippines. The success of these microfinance institutions can be attributed to their non-collaterized credit, low interest rate compared with other informal sources of credit, and easy accessible services.
The operation and performance of the five different microfinance institutions (MFI) operating in Laguna were reviewed. These are the: Center for Agricultural and Rural Development (CARD), Center for Community Transformation (CCT), Ahon sa Hirap, Inc (ASHI), Barangay Integrated Development Approach for Nutrition Improvement of the Rural Poor (BIDANI), and Kristiyuanong Kabalikat Lingap sa Kabuhayan at Tagumpay (KKLKT).
The MFIs were evaluated based on their credit operations, performance of the operators in extending credit to the poor; impact of the microfinance on the income and level of living of the borrowers, and the problems encountered in the implementation of the programs and their possible solutions.
Results showed that the implementation of the various projects by MFIs provided direct benefits to other members of the community in terms of stimulating trade activities among farmers, traders, sellers of consumers' goods and other services. There was also significant higher additional mean real net income for those borrowers who utilized their loans for the intended purpose and an increased capacity of the borrowers to save. Most of the borrowers also claimed that the MFI uplifted their levels of living. Some were able to purchase household appliances, improved their houses, and some invested their additional income to fund new projects.
Some of the problems encountered by MFI include, transfer of some members to other micro-credit operators; group misunderstanding; and delayed repayment and/or non-repayment of loans of the borrowers.
To improve the implementation of MFIs, it was recommended that there should be careful: screening of the member-borrowers; improvement in the monitoring scheme and imposition of penalties; there should also be communication and cooperation between MFIs working in the same area to prevent overlapping; and enhancement of the role of the People's Credit and Finance Corporation especially with respect to acting as governing body for microfinance institutions.
Location
UPLB Main Library Special Collections Section (USCS)
College
College of Economics and Management (CEM)
Language
English
Recommended citation
Huelgas, Romeo R., "Impact evaluation of microfinance operations in selected areas of Laguna" (2024). Professorial Chair Lecture. 678.
https://www.ukdr.uplb.edu.ph/professorial_lectures/678
