People’s Credit and Finance Corporation

PEOPLE’S CREDIT AND FINANCE CORPORATION

(The Philippine Microfinance Institution)

• 1960’s : Rural banks / Cooperatives extend small loans to farmers and fisher

folks.

Brief History of Microfinance in the Philippines

• 1970’s/80’s : Rural banks / development banks / government financial institutions

provide highly subsidized credit to the rural poor.

• Late 80’s : Microfinance as a new approach to credit delivery. : NGO’s as potent partners of

government.

• 1996 : Formation of microfinance coalition - NGOs and government agencies, like PCFC

• 1997/2006 : National Strategy Framework for Microfinance

: Microfinance integrated into Philippine Banking System

MICROFINANCE:

is the provision of a broad range of financial services such as deposits, loans, payment services, money transfers and insurance products to the poor and low – income households, for their micro – enterprises and small business, to enable them to raise income levels and improve their living standards.The maximum loan amount for microfinance loans is P150,000 (approximately US$3,000)

National Strategy Framework of Government for Microfinance

Greater role of private microfinance institutions (MFIs) in the provision of financial services Enabling policy environment to facilitate increased participation of the private sector.

Market oriented financial and credit policies

Non – participation of government line agencies in credit program implementation

People’s Credit and Finance CorporationLead government entity specifically tasked to

mobilize resources for microfinance services for the exclusive use of the poor

Investment Loans : Principally for livelihood activities

Micro – housing Micro – energy Micro – agri

Institutional Loans :Capability building activities to strengthen partner MFIs

PCFC Performance (As of September 2009)

Total loans releases - P 12.6 B

Investment - P 11.6 B

Institutional - P 1.0 B

Outstanding Balance -P 3.2 B Total Resources -P 3.5 B

Client Outreach - 2.8 M

No. of MFI Partners - 164

Collection Rate - 96%

EFFECTS OF TYPHOON ONDOY AND PEPENG

AREAS AFFECTE

D

NO. OF MFIS

AFFECTED

NO. OF INCLUDING AFFECTED

INCLUDING STAFF

ASSISTANCE EXTENDED BY

MFIs

ASSISTANCE

EXTENDED BY PCFC

NCR and

Southern Luzon

10

6______

16

135,078

26,125_______161,203

-Relief operations- Restructured loans and provided new loans- Provided calamity loans- Release of insurance claims c/o MBA program- Moratorium on amortization payments to selected end clients subject to BOD approval

Initially provided relief goods for end clients

SCHEMES TO ASSIST MFIs AFFECTED BY CALAMITIES

Option 1: Moratorium on amortization payments

• Deferment of up to six (6) months on the amortization payments (principal and interest)

Option 3: Provision for Institutional Loans• Re – alignment of the usage of the previously approved

Institutional facility for repairs and / or acquisition of office equipment damaged by typhoon.• Re – alignment of a portion of the Investment facility to Institutional facility.

Option 2: Provision for Special Loans• Special loans for refinancing with a term of up to four (4) years

THANK YOUand

HAVE A GOOD DAY!!!