Category: Microfinance

Fragile recovery persists among nanoenterprises post pandemic

Update 18 of SEDPI’s Rapid Community Assessment (RCA)
October – December 2022

As the world slowly recovers from the pandemic, the economic landscape remains uncertain, especially for nanoenterprises. A recent survey conducted by our organization, Social Enterprise Development Partnerships, Inc. (SEDPI), reveals that 99% of nanoenterprises have resumed operations as of December 2022, indicating a promising recovery for this crucial sector of the economy.

Despite the positive news, recovery remains fragile with 52% of nanoenterprises surveyed experiencing weak demand. Access to supplies has been a continuing concern with 27% of nanoenterprises still reporting difficulties in obtaining the necessary supplies.

SEDPI’s latest self-rated poverty survey reveals that the impact of the pandemic on poverty levels remains significant. For 2022, 54% of respondents rated themselves at the poverty line, a decrease from 81% in 2021. The number of respondents who rated themselves as poor is steady at 3% and 4%. On a positive note, the number of respondents who no longer consider themselves poor nearly tripled from 16% in 2021 to 41% in 2022.

According to the Social Weather Stations, which conducts the survey at the national level, self-rated poverty was recorded at 48% in 2021 and 51% in 2022. The considerably elevated self-rated poverty at the national level suggest that a greater number of nanoenterprises that SEDPI serves experienced better economic conditions.

Over the past three years, SEDPI has conducted an impact assessment to evaluate its support for nanoenterprises through self-evaluation or perception surveys. The results are as follows:

 Dec 19Dec 21Dec 22
Help in growing business82%100%98%
Education of children70%85%98%
Improve housing67%99%98%
Improve nutrition81%100%100%
Increase income82%100%97%

The perception survey suggests that SEDPI’s assistance plays a crucial role in alleviating hardships among nanoenterprises in areas such as business growth, education, housing, nutrition, and income. This may be the reason why the highly significantly lower self-rated poverty data among SEDPI nanoenterprises compared to the national survey. Additional interventions and strategies in the areas of disaster risk reduction, housing and health are necessary to enable a more comprehensive and lasting escape from poverty.

The majority of respondents are nanoenterprises (45%), owned and operated by women, with an average age of 43 and 73% being married. Of these nanoenterprises, 40% rely on other sources of income, such as employment, while 12% are unpaid family members, and 2% are unemployed.

SEDPI is a microfinance institution dedicated to providing ethical financing to nanoenterprises in Agusan del Sur, Davao de Oro, Davao del Norte, and Surigao del Sur. Their efforts have led to significant improvements in various aspects of the beneficiaries’ lives, such as business growth, education, housing, nutrition, and income.

Resilience and Recovery: A Chronological Analysis of Nanoenterprises Amidst the COVID-19 Pandemic

The COVID-19 pandemic has had a profound impact on nanoenterprises (NEs) worldwide, with various stages of recovery, demand trends, and access to supplies experienced throughout the course of the pandemic. This article examines the chronological analysis of NEs’ recovery, demand trends, and access to supplies from March 2020 to December 2022, based on the Rapid Community Assessment conducted by the Social Enterprise Development Partnerships, Inc. (SEDPI). By analyzing these trends, we can better understand the challenges faced by NEs and the factors contributing to their resilience and adaptability.

March 2020: Initial Pandemic Impact, Demand Shift, and Supply Chain Disruptions

At the beginning of the COVID-19 pandemic in March 2020, 34% of NEs stopped their operations due to lockdowns and social distancing measures, while 66% resumed operations. Demand was characterized by 8% of NEs experiencing no buyers, 78% experiencing weak demand, and 13% witnessing strong demand, as consumers’ priorities shifted towards essential goods and services. Supply chain disruptions affected NEs, with 36% facing difficult access to supplies and 64% having access to necessary resources.

June 2020: Early Recovery, Persistent Weak Demand, and Supply Chain Struggles

In June 2020, the recovery of NEs continued, with 91% resuming operations and only 9% remaining closed. However, demand remained weak, with 7% of NEs having no buyers, 72% facing weak demand, and 21% enjoying strong demand. Access to supplies was a significant challenge, as 81% of NEs had adequate access while 19% faced difficulties due to ongoing supply chain disruptions caused by the pandemic.

December 2020: Relief, Recovery, Improved Demand, and Better Supply Access Amid Typhoon Vicky’s Impact

By December 2020, government relief packages and easing of lockdown restrictions helped many NEs recover, with 3% remaining closed and 96% resuming operations. Demand improved slightly, with 4% of NEs having no buyers, 75% facing weak demand, and 21% enjoying strong demand. The holiday season likely contributed to increased consumer spending. Access to supplies significantly improved, with 90% of NEs having access and only 10% experiencing difficulties.

However, during this period, Typhoon Vicky hit the region, causing agricultural production losses in rice, corn, high-value crops, and livestock. The typhoon also triggered floods and landslides, resulting in damaged or destroyed homes in coastal areas. The natural disaster added challenges to the recovery process of nanoenterprises, particularly those in the affected areas and those dependent on agricultural production. Although the overall trend in December 2020 indicated progress in recovery, improved demand, and better access to supplies for nanoenterprises, the recovery would have been even more significant if not for the added challenges brought about by Typhoon Vicky.

March 2021: Steady Recovery, Increased Strong Demand, and Improved Supply Access

By March 2021, the situation for NEs had improved, with 97% resuming operations and only 3% remaining closed. Demand patterns shifted, with only 1% of NEs having no buyers, 52% experiencing weak demand, and 47% enjoying strong demand, likely due to the easing of restrictions and ongoing vaccination campaigns. Access to supplies improved, with 73% of NEs having adequate access and 27% still facing difficulties.

June 2021: Full Recovery, Diverse Demand, and Enhanced Access to Supplies

By June 2021, 100% of NEs resumed operations, marking a full recovery in this period. Demand varied, with 2% of NEs having no buyers, 64% facing weak demand, and 34% experiencing strong demand. Access to supplies continued to improve, with 82% of NEs having adequate access and only 18% facing difficulties.


September 2021: Delta Variant Surge, Granular Lockdowns, and Nanoenterprise Adaptation


In September 2021, the Delta variant surged in the Philippines, prompting the government to implement granular lockdowns as opposed to the general lockdowns previously imposed. This new approach aimed to prevent the wholesale disruption of jobs and livelihoods while still addressing the public health crisis. Despite the surge and the implementation of granular lockdowns, 96% of NEs continued to operate, while only 4% temporarily stopped their operations.

Demand patterns during this period fluctuated, with 12% of NEs having no buyers, 66% experiencing weak demand, and 22% witnessing strong demand. As the granular lockdowns targeted specific areas with high infection rates, many nanoenterprises had to quickly adapt to the changing circumstances and market conditions. Access to supplies remained relatively stable, with 77% of NEs having adequate access and 23% facing difficulties.

The September 2021 period demonstrated the resilience of nanoenterprises in the face of new challenges posed by the Delta variant and the government’s shift in lockdown strategy. Despite the hurdles, the sector continued to adapt and maintain its operations, contributing to the nation’s economic recovery.

December 2021: Continued Recovery, Increased Strong Demand, and Moderate Access to Supplies

By December 2021, widespread vaccination campaigns allowed for more relaxed social distancing measures and a resurgence in consumer demand. The percentage of stopped NEs remained at 3%, while 97% resumed operations. Demand for NE products and services further improved, with 9% of NEs having no buyers, 65% facing weak demand, and 26% experiencing strong demand. Access to supplies became more moderate, with 77% of NEs having access and 23% facing difficulties.

March 2022: Steady Operations, Persistent Weak Demand, and Improved Access to Supplies

By March 2022, the status of operations remained consistent, with 4% of NEs stopped and 96% resumed operations. Demand continued to lean towards weakness, as 8% of NEs had no buyers, 67% faced weak demand, and 26% experienced strong demand. However, access to supplies significantly improved, with 85% of NEs having access and only 15% facing difficulties.

September 2022: Temporary Setbacks, Fluctuating Demand, and Slightly Reduced Access to Supplies

In September 2022, the temporary increase in stopped NEs to 4% could be attributed to localized outbreaks and new COVID-19 variants. Despite these setbacks, 96% of NEs remained operational. However, demand patterns fluctuated, with 15% of NEs having no buyers, 36% experiencing weak demand, and 49% witnessing strong demand. Access to supplies slightly declined, with 73% of NEs having access and 27% facing difficulties.

December 2022: High Inflation Impact on Nanoenterprises, Demand Patterns, and Purchasing Power

In December 2022, the Philippines’ headline inflation increased to 8.1 percent, as reported by the Philippine Statistics Authority (PSA). The high inflation rate led to a decrease in purchasing power, resulting in reduced consumer spending, particularly among low-income households. Despite the inflationary pressures, 99% of NEs remained operational, while only 1% stopped their operations, showcasing the resilience of the sector. 

Compared to September 2022, when 36% of NEs faced weak demand, the percentage increased to 52% in December 2022, illustrating the heightened challenges for these enterprises due to reduced consumer spending amid high inflation. The decreased purchasing power of consumers, especially in low-income households, contributed to the fluctuations in demand patterns for nanoenterprises.

Access to supplies remained relatively stable, with 73% of NEs having access to necessary resources and 27% facing difficulties in acquiring them. The December 2022 period highlighted the challenges faced by nanoenterprises due to high inflation and its impact on consumer spending, while also demonstrating the adaptability of the sector in sustaining operations amid economic challenges.

Conclusion:

Throughout the COVID-19 pandemic and various external challenges, such as natural disasters and high inflation, nanoenterprises have consistently demonstrated resilience and adaptability in maintaining operations, responding to fluctuating demand, and navigating supply chain disruptions. As of December 2022, the sector has reached a near full recovery, with stabilizing demand patterns and steady access to supplies. The findings from SEDPI’s Rapid Community Assessment underscore the importance of continued support and empowerment for nanoenterprises, as they play a crucial role in local economies and communities. As the world moves forward from the pandemic’s impact, fostering collaboration between government, business, and community organizations will remain vital in ensuring the sustained success and growth of nanoenterprises in the face of ongoing and future challenges.

Respondents:

In December 2022, the Rapid Community Assessment (RCA) conducted by SEDPI garnered responses from 1,398 respondents across the provinces of Agusan del Sur, Davao de Oro, Davao del Norte, and Surigao del Sur. The profile of respondents in this edition of the survey was similar to that of previous editions. The majority of respondents were female (86%), with an average age of 43, and 73% of them were married. When it came to sources of income, 40% were employed, 45% were nanoenterprise owners, 12% were unpaid family members contributing to the family business, and 2% were unemployed.

Nanoenterprise status

 Mar’20Jun ’20Dec ’20Mar’21Jun ’21Sep ’21Dec 21Mar ’22Sep’ 22Dec 22
Stopped34%9%3%3%0%4%3%4%4%1%
Resumed66%91%96%97%100%96%97%96%96%99%

Market demand for NE products and services

 Mar’20Jun ’20Dec ’20Mar’21Jun ’21Sep ’21Dec 21Mar ’22Sep’ 22Dec 22
No buyers8%7%4%1%2%12%9%8%15%6%
Weak demand78%72%75%52%64%66%65%67%36%52%
Strong demand13%21%21%47%34%22%26%26%49%42%

Access to supplies for NE livelihood operations

 Mar’20Jun ’20Dec ’20Mar’21Jun ’21Sep ’21Dec 21Mar ’22Sep’ 22Dec 22
With access64%81%90%73%82%77%77%85%73%73%
Challenge in access36%19%10%27%18%23%23%15%27%27%

Philippine microfinance industry estimates

The Bangko Sentral ng Pilipinas (BSP) defines microfinance as 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 microenterprises and small businesses, to enable them to raise their income levels and improve their living standards.[1] It is also defined as the provision of financial services to low-income clients, including the self-employed.

Who is a microfinance client?

Typical microfinance clients are low-income persons that do not have access to formal financial institutions. Microfinance clients are typically self-employed, often household-based entrepreneurs. 

In rural areas, they are usually small farmers and fisher folk, as well as others who are engaged in small income-generating activities such as food processing and petty trade. In urban areas, microfinance activities are more diverse and include shopkeepers, service providers, artisans, street vendors, and others.[2]

Microfinance products

Financial products of microfinance used to be limited to savings and credit. Several financial services have sprung up in the past decade to address the other financial services needs of microfinance clients like insurance, remittance and even housing services.

Loans that are up to PhP150,000 used for consumption or productive purposes are classified as microfinance loans as stated in government’s Social Reform Agenda or Republic Act 8425 of 1997. The same amount is set as the maximum capitalization for microenterprises.

For microhousing loans, the Bangko Sentral ng Pilipinas (BSP) set the ceiling to PhP300,000 although the Housing and Land Use Regulatory Board (HLURB) classifies socialized housing at PhP450,000.

Government policy

The National Strategy for Microfinance envisions a viable and sustainable microfinance market that will help provide poor households and microentrepreneurs with greater access to microfinance services.

It calls for a greater role for the private sector and the non-participation of government line agencies in the provision of credit and guarantee programs. Emphasis is on the adoption of market oriented financial and credit policies to ensure viability and sustainability.[3]

It is worthy to note that the Philippines closed the gender gap in terms of financial inclusion[4] which is largely attributed to microfinance institutions.

Players, portfolio and number of clients

There are approximately 6,183 microfinance institutions in the Philippines. 

Microfinance institutionNumber
Banks (2022)[5]139
Cooperatives (2020)[6]2,762
Microfinance NGOs (2022)[7]27
Financing companies (2017)[8]673
Lending companies (2017)[9]2,582
Total6,183

The microfinance industry in the Philippines has grown into a PhP406 billion industry in terms of loan portfolio as of March 2022. [10] This would be larger if the portfolio from financing and lending companies that also mostly qualify as microfinance loans are added. the figure also

Microfinance institutionAmount of portfolio in billion pesos
2022 1Q202120202019201820172016
Banks 26.8  27.7  26.6  27.2  22.6  17.1  13.7 
Cooperatives 327.1*  327.1*  327.1  315.8  315.8  194.1  167.4 
MF NGOs  52.8  52.8  50.4  41.9  30.9  28.6  20.6 
Total 406.7  407.6  404.1  384.9  369.3  239.8  201.7 

* Carried over from 2020 figures, due to lack of updated data from the Cooperative Development Authority, to come up with a reasonable estimate of the total outstanding loans of the industry.

There are 18.2 million recorded microfinance clients in the banking system, Microfinance NGO and cooperative sectors.[11] In SEDPI’s research with various microfinance institutions, it is common for a client to have multiple memberships. In fact, a typical microfinance client has average membership in two to three microfinance institutions.

To estimate the number of microfinance clients served, the total number is multiplied by a factor 0f 50% to account for multiple memberships. This would bring the estimated number of microfinance clients in the industry to 9.1 million as of the first quarter of 2022.

Microfinance institutionNumber of clients/members
2022 1Q202120202019201820172016
Banks 1,985,422  1,978,394  1,996,657  2,410,677  1,986,683  1,956,276  1,686,152 
Cooperatives 9,900,000*  9,900,000 * 9,900,000  9,800,000  9,500,000  9,400,000  8,000,000 
MF NGOs  6,400,000  6,200,000  6,400,000  6,200,000  5,200,000  4,300,000  3,900,000 
Total 18,285,422  18,078,394 18,296,657 18,410,677 16,686,683 15,656,276 13,586,152 
50% of total 9,142,711  9,039,197  9,148,329  9,205,339  8,343,342  7,828,138  6,793,076 

* Carried over from 2020 figures, due to lack of updated data from the Cooperative Development Authority, to come up with a reasonable estimate of the number of microfinance clients in the industry.

Based on the above figures, the average loan size per client in the industry is PhP22,000 as of the first quarter of 2022. Microfinance NGOs have the lowest average loan size at PhP8,250 which makes them reach the bottom of the pyramid. Cooperatives have the highest average loan size at PhP33,000 since most cater to salaried workers as well as farmers and microenterprises that require larger loan amounts. The average loan size for rural banks is PhP13,500.

Industry growth

Growth in microfinance portfolio was robust from 2017 to 2019, the pre-pandemic period, which registered 14% to 37% loan portfolio growth rate and 11%-16% member growth rate. Slight growth in loan portfolio was recorded in 2020 at 7% and remained flat in 2021 that registered only 1% loan portfolio growth.

Microfinance institutionGrowth in microfinance portfolio
20212020201920182017
Banks4%-2%20%32%25%
Cooperatives0%6%11%42%16%
MF NGOs 5%20%36%8%39%
Total1%7%14%37%19%

Number of clients had healthy growth rates from 2017 to 2019 which is ranged from 11% to 16%. On 2020 to 2021, the peak of the pandemic period, negative growth were recorded in terms of number of clients at -1% for each year. 

Microfinance institutionGrowth in number of clients
20212020201920182017
Banks-1%-17%21%2%16%
Cooperatives0%1%4%18%11%
MF NGOs -3%3%19%21%10%
Total-1%-1%11%16%11%

[1] BSP Circular No. 272, 30 January 2001

[2]Salonga, Edwin, “Microfinance: An Empowerment Tool for the Enterprising Poor,” October 8, 2003.

[3] Frequently Asked Questions on Microfinance, Bangko Sentral ng Pilipinas website

[4]https://public.tableau.com/views/MGIGendertableau/Dashboard1GPS?:embed=y&:showVizHome=no&:display_count=y&:display_static_image=y&:bootstrapWhenNotified=true

[5] bsp financial inclusion dashboard 220331

[6] bsp financial inclusion dashboard 220331

[7] list of sec accredited microfinance ngos 2022 221027

[8] list of financing companies with certificate of authority 171231

[9] list of lending companies with certificate of authority 171231

[10] Dashboard: Financial Inclusion in the Philippines, Bangko Sentral ng Pilipinas, December 2020

[11] Based on BSP financial inclusion dashboard and SEDPI multiple membership estimates

1 out of 4 nanoenterprises adopted online selling in response to lockdowns

At least one out of four nanoenerprises are now either selling their products online, or are buying products to be sold in their local communities to cope with granular lockdowns imposed by local government units. Out of 7,675 respondents, 26% sold products and 29% bought supplies online, to augment their livelihood operations.

Nanoenterprise is a SEDPI-coined term that refers to unregistered livelihoods of self-employed individuals that have capitalization of less than PhP50,000 to operate. SEDPI estimates that the vast majority of entrepreneurial poor in the Philippines are nanoenterprises, numbering around 8 million.

Nano level risk diversification

More than half of the respondents or 52% also claimed that they added other kinds of livelihoods in response to the pandemic. Nanoenterprises refer to this as “diskarte” to be able to survive the negative economic impact of the pandemic. Diskarte is the ability to use creativity and resourcefulness to respond to challenges and adversities.

Nanoenterprises involved in the agricultural sector were better able to weather the pandemic compared to their non-agri counterparts. Eighty nine percent of the respondents said that those with farms were able to adjust and fair better.

Farming households were able to harvest produce for consumption. The surplus farm produce were then sold in local markets through ambulant vending and online selling. This resulted in reduced expenses for food and at the same time provided ample additional income

Status of nanoenterprises

A year after the Enhanced Community Quarantine (ECQ) imposed in the whole country, all

nanoenterprises reported that they already resumed operations. At the peak of the ECQ last year, 69% of them stopped operations which prompted the government to distribute cash assistance.

As of March 2021, four out of ten respondents said that they have fully recovered from the negative economic impact of the pandemic; while 55% said that it will take them up to 2 months more, before they get back to their pre-pandemic levels.

During the first quarter of the year most areas in the country were under Modified General Community Quarantine (MGCQ), the lowest quarantine level imposed by the Philippine government. These reinvigorated the local economy due to ease in the flow of goods and mobility of customers.

 

Social Enterprise Development Partnerships, Inc. (SEDPI)

SEDPI provides capital to nanoenterprises through joint ventures to approximately 10,000 low-income households in Agusan del Sur, Davao de Oro and Surigao del Sur. Its members also benefit from life insurance as well as medical and disaster relief assistance through damayan. SEDPI also partnered with SSS and Pag-IBIG to bring social safety net programs of the government closer to nanoenterprises in rural areas.

This research is part of a series of rapid community assessments that determines the economic impact of COVID-19 to nanoenterprises. SEDPI began the research last March 2020. This latest update was conducted on April 2021 to cover the first quarter of 2021.

The 7,695 respondents is not a representative sample of the entire Philippines. It is highly localized to SEDPI members. However, this is a good case study that reflects the situation of nanoenterprise and the local economy in the countryside. SEDPI believes that the nationwide picture is not far from its research results.

Summary of findings:

  • Out of 7,675 SEDPI nanoenterprise respondents 26% sold products and 29% bought supplies online to augment their livelihood operations
  • 100% are resumed livelihood operations a year after the hard lockdown
  • 52% added other kinds of livelihoods in response to the pandemic
  • 89% said that those with farms were able to adjust and fair better
  • 40% fully recovered from the negative impact of the pandemic
  • 55% said it will take them up to 2 months more before they get back to their pre-pandemic levels

Previous rapid community assessment updates. The titles are hyperlinked. Click on the titles to full read article online.

SEDPI at Opisina ni Senator Risa Hontiveros Nag-abot ng Tulong sa mga Nasalanta ng Bagyong Vicky

“Sagol nerbyos hadlok lagi kay basi manganaod kay paspas kaayo ang pag taas sa tubig og sulod kaayo.” 

“Magkahalong nerbyos at takot dahil baka maanod kasi mabilis ang pagtaas ng tubig at pumapasok talaga.”

Ito ang naramdaman ni Roxanne Amigo habang rumaragasa ang baha na dala ng bagyong Vicky.

Kasama sa binaha at na-landslide ang mga residente ng Agusan del Sur at Surigao del Sur, kung saan mayroong microfinance operations ang SEDPI Development Finance, Inc.

Mula sa 10,000 SEDPI members, 1,884 ang apektado sa mga bayan ng Trento, Santa Josefa, Barobo, at Rosario sa Agusan del Sur at Lingig at Bislig sa Surigao del Sur. Dalawa ang inanod ng baha ang bahay. Isa naman ang na-landslide. 

Agad nakapagbigay ng relief goods noong December 2020 ang SEDPI at ang Office ni Senator Risa Hontiveros sa nasalanta ng bagyong Vicky.

Hindi man madalas na mabagyo ang Mindanao, naging handa ang SEDPI sa pagtulong sa mga members dahil sa Social Welfare Protection Program (SWEPP) nito. 

SWEPP ay ang hybrid microinsurance program ng SEDPI na pinagsasama ang “damayan” o pagtutulungan ng kapwa; formal life insurance mula sa CLIMBS Life and General Insurance Cooperative; at social safety nets mula sa gobyerno na binibigay ng SSS at Pag-IBIG Fund. 

Maliban sa regular contributions sa SSS at Pag-IBIG, nagcocontribute ang mga members ng PhP360 every six months para ma-cover ng SWEPP. 

Ang bahagi ng kontribusyon ay linalaan para sa “damayan”. Ginagamit ang naiambag ng mga members para tulungan ang kamember nila sa panahon ng kamatayan, pagkakasakit, sunog, o kalamidad. 

Ito ang naging pondo para makabigay ng relief goods sa mga nabaha at dagdag na PhP5,000 sa tatlong na-wipe out ang bahay.

Bawat pack ng relief goods ay naglaman ng limang kilong bigas at ilang groceries na good for one week para sa pamilya na may limang miyembro.

“Naibsan ang pag-aalala ko dahil may makakain na kami kahit papano. Dumating ang aming pinapanalangin,” masayang nasabi ni Roxanne. 

Naging malaking tulong ang donasyon na 134 sakong bigas na galing sa Liwanag at Lingap Program ng opisina ni Senator Risa Hontiveros. 

Ang programang ito ay nagsimula noong bagyong Rolly bilang isang typhoon relief effort. Sinundan pa ito ng tulong sa mga apektado ng mga bagyong Ulysses at Vicky. 

Mensahe ni Senator Risa Hontiveros, “Tuloy-tuloy ang pagpapadala natin ng Liwanag at Lingap sa mga kababayan nating naapektuhan ng kalamidad at nawalan ng kabuhayan. Umaasa akong sa munting paraan ay makatulong ang relief operations na ito para matugunan ang immediate needs gaya ng pagkain.” 

Naging maganda ang pagtutulungan ng komunidad, SEDPI at ng opisina ni Senator Risa Hontiveros. Sa unang linggo matapos ang bagyo at baha ay nakatuon ang mga nasalanta sa pag-aayos sa kanilang mga bahay at gamit at hindi sa paghahanap ng kanilang makakain. 

Ani ng Vince Rapisura, Presidente ng SEDPI, “Systemic and institutionalized safety nets talaga ang kailangan natin. Kailangan po talaga ay hindi lang yung sarili natin yung nag-eeffort pero nandyan ang private sector, nandyan ang public sector, nandyan ang community.” 

 

 

 

 

 

 

SEDPI at Ambagan PH Tumulong sa mga Nasalanta ng Bagyong Vicky

Agad na nag-abot ng tulong ang SEDPI at Ambagan PH sa 1,884 na nasalanta ng bagyong Vicky sa Agusan del Sur at Surigao del Sur. 

Matapos ang tuloy-tuloy na ulan na dulot ng bagyong Vicky sa Mindanao nagdulot ito ng pagbaha at landslide. 

Kasama sa naapektuhan ay ang mga residente ng Agusan del Sur at Surigao del Sur, kung saan mayroong microfinance operations ang SEDPI Development Finance, Inc. 

Mula sa 10,000 SEDPI members, 1,884 ang apektado sa mga bayan ng Trento, Santa Josefa, Barobo, at Rosario sa Agusan del Sur at Lingig at Bislig sa Surigao del Sur. Dalawa ang inanod ng baha ang bahay. Isa naman ang na-landslide.

Bago pa mabagyo ang Mindanao, naging handa ang SEDPI sa pagtulong nito sa mga nasalanta dahil sa Social Welfare Protection Program (SWEPP). 

SWEPP ay ang hybrid microinsurance program ng SEDPI na pinagsasama ang “damayan” o pagtutulungan ng kapwa; formal life insurance mula sa CLIMBS Life and General Insurance cooperative; at social safety nets mula sa gobyerno na binibigay ng SSS at Pag-IBIG Fund. 

Maliban sa regular contributions sa SSS at Pag-IBIG, nagcocontribute ang mga members ng PhP360 every six months para ma-cover ng SWEPP. 

Ang bahagi ng kontribusyon ay linalaan para sa “damayan”. Ginagamit ang naiambag ng mga members para tulungan ang kamember nila sa panahon ng kamatayan, pagkakasakit, sunog, o kalamidad. 

Pondo mula sa SWEPP Damayan ang pinagkuhanan para sa relief goods sa mga nabaha at dagdag na PhP5,000 sa tatlong na-wipe out ang bahay.

Ani ng Vince Rapisura, Presidente ng SEDPI,“Ito ay isang patunay na ang mahihirap ay kaya nilang tulungan ang mga sarili nila kung merong maayos na sistema at hindi kinukurakot.” 

Nadagdagan ang pondo para sa relief operation nung nag-donate ang Ambagan PH sa SEDPI Foundation, Inc. ng PhP20,000.

Ang Ambagan PH ay isang network ng volunteers at initiatives na nabuo para tumugon sa mga krisis, tulad ng bagyong Vicky. Donasyon at crowdsourcing ang pangunahing pinagmumulan ng kanila resources. 

Sa karanasan nila mula ng October 2020 na-realize nila na, “Walang maliit o malaking ambag. Sa panahon ng krisis, lahat ng ambag ay dakila.”

Bawat pack ng relief goods na napamigay ng SEDPI at Ambagan PH ay naglaman ng limang kilong bigas at ilang groceries na good for one week para sa pamilya na may limang miyembro.

Pasalamat ng SEDPI member na si Dondon Ocsema, “Malaking tulong iyon para suportahan ang ilang araw na kakainin lalo na ilang araw akong hindi nakapamasada.”

Dahil meron na silang makakain para sa isang linggo mas nabigyang tuon ng mga nasalata, tulad ni Dondon, ang pag-aayos sa kanilang mga bahay at gamit. 

Isa itong full-circle experience para kay Angelica Reyes o Anj na SEDPI Senior Program Officer at Co-Founder at Spokesperson din ng Ambagan PH. 

Nagsimula ang 2020 nang mag-interview si Anj, kasama ang iba pang taga SEDPI, ng members sa Agusan del Sur at Surigao del Sur para malaman ang impact ng microfinance program. 

Anj Reyes kasama ang ilang SEDPI members nung February 2020

Nagtapos ang taon na pinagtagpo ni Anj ang SEDPI at ang sinimulan niyang grupo na Ambagan PH para tumulong sa mga taong minsan ay nakadaupang-palad niya.

“Malaki ang pasasalamat ko sa SEDPI dahil marami sa organizational at administrative skills ko ay natutunan ko mula sa pagiging program officer ng SEDPI. Higit sa lahat, lalong napatibay ng SEDPI ang advocacy ko na makatulong sa kapwa.” – Angelica Reyes

Para sa mga gustong mag-ambag, pumunta lang sa facebook.com/ambaganph at i-click ang sign up link.

 

 

 

 

Agrarian Reform Beneficiaries in Sultan Kudarat Receive Millions Worth of Agri-Inputs from DAR – IARCDSP

Pandemic or not, farmers in Mindanao tirelessly till the soil. This is why the Department of Agrarian Reform, together with SEDPI, continue to work while majority of the population are on a standstill to bring the most awaited agri-input investments from the DAR – Italian Assistance to ARC Development Support Program (IARCDSP) to our farmers. 

Five (5) Agrarian Reform Beneficiaries and Farmers Organizations in Sultan Kudarat received the first tranche of the promised agricultural inputs that shall kickstart their agricultural businesses supporting farmers in their Agrarian Reform Communities (ARC).

Josephine Balicaw, officer of Marguez United Irrigators Farmers Association (MUIFAI) in Pag-asa ARC, couldn’t help but shed tears when around PhP1.5M sacks worth of inputs were unloaded from a 10-wheeler truck and brought to what was once an empty warehouse. They have been preparing for this through the capacity interventions of SEDPI and now the moment has come for them to put theory into action. 

 

Josephine Balicaw, third from left, together with other officers and members of Marguez United Irrigators Farmers Association in Pag-asa ARC.

In the same way, Noria Gapor, officer of Sigay Ka Tamontaka 4 Association (SKTFA) from Kutawato ARC, was reeling with disbelief when she was told that all the sacks were to be offloaded and not brought elsewhere. “Akala ko ilang sako lang para sa amin. Lahat pala!” (I thought we’re only getting a few sacks of inputs but we’re getting them all!), said Gapor.

It is quite an emotional experience as well for our farmers in Naldan Creek Irrigators Association (NCIA) in Lambayong ARC, Kalayaan Communal Irrigators Association (KCIA) in Lutayan ARC, and Taguisa Agrarian Reform Beneficiary Multi-Purpose Cooperative (TARBMPC) in Lebak ARC. For these ARBOs, now that the inputs are here, they will be able to provide farmer-friendly agri-input financing, farm machineries rental, and hauling services to fellow farmers in their community.

This is one of the foreign- assisted projects being implemented by the Department of Agrarian Reform and funded under the loan agreement executed with the Government of Italy. This project involves not only millions worth of agricultural inputs, farm machineries and equipment, hauling trucks, but also intensive capacity building training on microfinance management tools and monitoring & evaluation systems spearheaded by SEDPI. 

There is a total of 35 Agrarian Reform Beneficiaries/Farmers Organizations involved in the DAR – IARCDSP Project covering Sarangani, Sultan Kudarat, Maguindanao, and Lanao del Sur Provinces. 

 

SEDPI’s Group Yearly Renewable Term Insurance

SEDPI offers Group Renewable Term Insurance (GYRT) in partnership with CLIMBS, a service more catered to common Filipino households.

Term insurance provides protection against emergencies for a specific period of time. As lifetime coverage is not always needed, term insurance provides cheaper premiums with larger benefits. On average, investment-linked insurance schemes charge PhP80,000 in premiums.

For the same PhP1 million coverage, individual term life insurance premiums can be as low as PhP5,500 for ages 21-30 and cap around PhP21,000 for ages 51-60. SEDPI’s Group Yearly Renewable Term has PhP500,000 life benefits and PhP500,000 accident benefits. For ages 18-60, the premium is PhP4,000. This makes it even more affordable compared to individual term insurance policies. Due to its affordability, participation in group insurance is high.

Group insurance means that one contract is issued to cover a group of people. In this case, SEDPI is the policyholder. As a SEDPI member, one is entitled to access this group insurance program, even if they are abroad.

OFWs dealing directly with Philippine-based insurance agents are constrained by a lack of international selling licenses. Since SEDPI is the policyholder an directly deals with CLIMBS, OFWs can participate in the insurance program. Eligibility is determined by membership to SEDPI, and the process does not require rigorous underwriting due to the large number of members.

Yearly Renewable insurance indicates that the insurance protection coverage is active for one year. The annual premium must be paid in order to restart coverage for the following term.

The group’s performance based on mortality rates is evaluated each year. A higher mortality rate may mean a higher adjusted premium the following year, but a lower mortality rate than average can lead to a lower premium for the group.

SEDPI members in Mindanao have exhibited lower mortality rates, and SEDPI is in negotiations with CLIMBS to lower the premium for this group.

Enter keyword GYRT on Vince Rapisura’s Facebook messenger to join.

Never too small for hope (sari-sari store) – International Day of Rural Women 2020

Ms. Mary Jane Selecia, sari-sari store owner in Manguindanao, Philippines.

Mary Jane Selecia is a mother of five who lives in a rural community in Upi, Maguindanao in the Philippines. She runs a sari-sari store (corner store) in her community. COVID-19 has significantly affected their household and community.

To mitigate the spread of COVID-19, the government imposed community quarantine measures which includes physical distancing, movement restrictions, suspension of classes, and conduct of awareness campaigns on infection, prevention, and control measures (IPC). To cushion the socio-economic impact of the quarantine, subsidies were provided to households to complement their existing resources.

The government subsidy reminds Mary Jane that her household needs to maximize their savings. “My shop is bringing in one-third of the profit. I would earn around P4,000 (US$ 82) and now I am fortunate if I make P1,000 (US$20) a week. We invest P3,000 (US$ 61) a week just to keep the store running,” she said. Their household requirement for a month is estimated at PhP 9,000 (US$ 185) and was previously covered from the sari-sari store’s profits.

Borrowing money is becoming a vicious cycle for Mary Jane, “We have no savings and the income we make for our businesses go towards repaying our loans from relatives and friends. It seems like we are borrowing to pay over and over again,” she said.

Relief information is even more scarce when in the remote mountainous areas like Tinungkaan. The interventions in Mary Jane’s town were constrained to the Department of Social Welfare and Development (DSWD) conducting a survey to determine the poorest population in the village.

Mary Jane’s husband works as a Barangay Secretary and his work became an unexpected lifeline, “We did not need to apply for the Social Amelioration Program (SAP) because of my husband’s job. We are also beneficiaries of the Pantawid Pamilyang Pilipino Program (4Ps),” she explained.

The SAP has given qualified families P5,000 to P8,000 per month for two months. “We bought one sack of rice. The remaining money is additional capital for our store,” she said.

Farming has augmented the dwindling income of the household. “Our alternative sources of income are planting vegetables and raising farm animals. The small farm supports us while providing us with food. We are often forced to consume supplies from the sari-sari store,” she explained.

Stock in her store is already limited because of the limited supply in Noro, where she buys her supplies. Transportation cost for each of the trips to Noro is now P100, which is an exacerbated cost during the lockdown.

Everyday expenses have become a challenge for her community. “There is a decline in sales because many of our neighbors and customers do not have work,” she said. As the COVID-19 situation evolves, Mary Jane adapts to provide food on the table for her children and access to basic commodities in her community.

This case study on the plight of microenterprises in the Philippines was selected for the International Day for Rural Women (15 October 2020). It was originally shared across the Asian Disaster Preparedness Center (ADPC) platforms for the International Day for Rural Women

Here are the links:

Cambodia– Website: The Grain of the Matter
Link: Facebook, Twitter

Link: Facebook, Twitter

The Philippines– Website: Never too Small for Hope
Link: Facebook, Twitter

Never Too Small for Hope- Part III (Service Economy)

Cover

Federic Caneta / Resident of Cebu City – Furniture Maker 

The miter saw is silent in Federic Caneta’s workshop. The carpenter has a cabinet and a couple of shelves from commissions that were canceled because of the lockdown. His monthly projects vary with demand, “I make furniture on a custom-made or pre-order basis. Orders would range from P8,000 to P15,000 a month. There has been no demand since the enhanced community quarantine.” Never Too Small for HopeHis daughter, Rica Caneta, is a private school teacher. She has been helping him sell some of his works, “I made a hanging cabinet and a storage cabinet with the extra wood from the previously commissioned projects. I sold them for P2,500 and P3,000 respectively. Rica is working from home so she takes some time to promote my pieces through social media.” The average monthly salary for a carpenter is P16,800. Profits come from down-payments upon the order or balance payments upon delivery. Federic is concerned that he might not have supplies to continue the few online sales, “I had one piece that I was not able to complete. I was unable to obtain the needed materials due to travel restrictions. Some customers have also canceled their orders.”Never Too Small for HopeFederic’s son, Drake, is an animal handler and is supporting the family through these times, “My children are providing financial support we need. Our monthly expenses are usually P10,000 which was primarily covered through my business.” He has discovered the potential of taking his business online to help it grow, “I would need around P10,000 to buy materials for future orders. Online sales have made me realize that professional guidance in promoting our business would really help it expand.”

Chierrie Villarosa Marces / 29 years old / Resident of General Santos City- Pisonet 

When life gives you the Internet, make digital solutions for your business. Chierrie Villarosa Marces owns a small Pisonet (pay-by-the-minute computer and Internet shop). The lockdown has forced her to close her shop so she is selling goods through digital networks, “I have closed the pisonet since mid-March. I am focusing on online trading which includes buying and selling dry goods, food items, and other basic commodities.”

Online sales are the only means of income for Chierrie, “I make around P200 for every P1,000 I invest in online selling. I have been doing it for some time but even that has experienced a decline.” Her customers have stopped ordering dried foods, “Basic goods and essential commodities such as fruits and cooking ingredients are the priority now. We own a tricycle that we use to transport orders. Travel restrictions have made getting the goods from my supplier difficult.” NeverHowever, these sales do not provide stability for the pisonet. Filipinos spend the most time on the Internet around the world, averaging in at 10 hours per day. Her Internet business had expanded to printing, scanning, and photocopying services, “I would make around P25,000 every month from the pisonet. The expenses would be around P8,000 for the Internet and electricity bills. My direct suppliers have been generous enough to offer freebies on their services for now.”

Chierrie is struggling to make ends meet, “Our household expenses are about P10,000 every month. I am grateful to the government for providing us with rice, meat, canned goods, and other staples.” She is worried about restarting the business once the community quarantine is lifted, “I estimate that we will need at least P5,000 to restart the pisonet. It would cover two months of our Internet bill. We can manage the cost of computer maintenance and business equipment.”

John Cuvin / Resident of Naga City – Laundry Shop 

John Cuvin, his wife, and his mother are bonded in their dream to be business owners, “My wife owns a beauty salon and my mother has also had a number of businesses.” He established a laundry shop, JJS Suds Laundry Service as a lucrative business opportunity. Dry cleaning and laundry services ranked second in the service industry, providing business opportunities for 18% of entrepreneurs. John’s monthly expenses amount to P25,000 as he provides support for his family, “My wife and mother live in different provinces and I would pay for their utilities and my mother’s caretaker. I want to provide them with financial support.”

Never Too Small for HopeJJS Suds is a connection to the local community, “We would normally have 30 to 50 customers a day before the lockdown. We are lucky if there are five customers these days. Our daily revenue would reach up to P15,000 per day and that target is now P5,000.” John has had to cut corners to adapt to the new normal, “We had seven workers on a daily basis and now there are only two at any given time. The store is only open for limited hours because customers no longer come in late at night. It has led to slower service delivery. We have also started using electric fans.”

Basic supplies have become much harder to procure. His team promotes the use of dryer sheets when the fabric conditioner is short on supply- “Wholesalers have increased the price of fabric conditioner and liquid detergent from P10 to P11 per sachet. Sometimes we have to buy them from the local retailers for P17. The dryer sheets would be available for P500 per box but they are not locally available. We sell each sheet for P10.”Never Too Small for HopeCommunication is a constant with John’s regular clientele. The staff coordinate with customers on Facebook. John has also decided to bring the business to his regulars, “We also support our personnel needs by helping with the laundry and delivery. The shop currently relies on delivery modality to remain operational. Finding alternative solutions is necessary to keep the business running.”

Although business expenses were high, John would earn between P30,000 to P50,000 a month, “I spent around P120,000 which included the P50,000 for my staff’s salary on a monthly basis.” He anticipates support or policies in order to relieve the challenges they are facing, “It would be really helpful if the government could provide financial support to cover the salaries of our staff, and postpone rent collection or allow us to pay it in installments.”

Pureza Elopre Granario / Resident Naga City – Sari-sari store 

Opening Pureza’s shop is necessary for survival but also puts her family at great risk, “My husband and mother-in-law are both over 50. I worry that I might bring the virus home.” Work is scarce for her husband who is a plumber. “We are fortunate that profits from the store are still P800 to P1,000 per day.”

The green and white awning in her shop have been a part of her neighborhood’s fabric for years, “My supplies get sold easily. Before the quarantine, sales were mostly liquor and sodas. Customers now want canned goods and frozen foods which ensure that they can stay at home. Sales of phone credit are always in-demand and have gone up by 20%.” Pureza maintains is systematic when it comes to buying stock for her shop, “We have to go at a specific time and day so that we can avoid the long lines. There is still a queue but any steps we can take to be cautious are necessary.”

A savings and investment scheme supports small businesses from any shock in income flow. Pureza is fortunate to have enough to restart her business. She estimated that P10,000 was enough to restock her full inventory, “I was a part of the Social Amelioration Program (SAP) through which I received P5,000. We used the money to purchase additional inventory for the store.” Her mother-in-law has also contributed to the shop. “She gave me a P2,000 loan which I used to buy coffee, sugar, and soap.”Never Too Small for HopePureza’s shop is her saving grace during the uncertainty, “We need P9,000 for our household expenses and about P7,000 for the store.” The store is a constant for her. Its history in the community mirrors Pureza’s presence and determination, “We reinvest all of our profits into the shop. I’m obtaining inventory through other channels because I want to see my store grow despite the circumstances.”

At APP, we focus on the vulnerable sectors of our society in our development initiatives. MSMEs are among the priority sectors of our national chapter, Philippine Preparedness Partnership’s (PHILPREP) and its targets in local program activities. PHILPREP has developed these case stories to amplify the voices on the ground, especially during the COVID-19 pandemic. It seeks to amplify human stories to raise awareness on how disasters affect the most vulnerable communities.

This article was developed in partnership with the Asian Preparedness Partnership (APP). More information about APP may be found using this link: Asia Preparedness Partnership (APP).

Click the links for Part I and Part II of this series.