1. Housing Microfinance,
Addressing Home Improvements
and Housing Needs
Teresa Ganzon
Bangko Kabayan
2010 RBAP-MABS National Roundtable Conference
Hyatt Hotel and Casino, Manila
June 2-3, 2010

2. GABAY Housing Loan
Bangko Kabayan’s Housing Microfinance

3. Why 2005 MF Survey
HMF?
1. Additional working capital ✔
2. Education ✔
3. Medical purposes ✔
4. House repair & renovation
5. Addt’l capital for farming activities
6. Car

4. Why
HMF?
 Feasibility of product because of higher
demand for home improvement
 Additional loan product for
Microfinance Clients (market
penetration)
 Increase in no. of accounts for Account
Officers
 Client retention (because GABAY is an
incentive loan for existing clients)

5. Sample Flyer

6. Clients
(As of March 2010)
 Number of accounts: 267
 Total Releases: P 5,496,000.00
 Loan Portfolio: P 3,899,074.36
 Ave. Loan Term: 10 months
 Ave. Loan Amount: P 20,500.00

7. Type of Projects
Kitchen Improvement 31 11.6%
Wall Finishing and Painting 45 16.8%
Ceiling and Roof Improvement 23 8.6%
Bathroom Improvement 16 6%
Improvement of doors and windows 20 7.5%
Floor finishing and Improvement 14 5.2%
Water and Electric Supply 17 6.3%
Additional Capital for House Construction 13 4.9%
Home Improvement/Renovation (addt’l rooms) 61 22.9%
Fence Improvement 9 3.4%
Apartment 2 0.75%
Other related projects (poultry, piggery, store) 16 6%
Total 267 100%

8. Developmental
Stage
STEP 1: Market Research was
conducted through the
support of MABS
a) with two (2) days indoor
and actual field training
b) preparation of draft product
manual
c) FGD with BM’s, AO’s,
Supervisors and selected
respondents from the branch

9. Developmental Stage
STEP 2: Training of Supervisors and Account Officers of Pilot
Branches
a) in-house training with AOs and Supervisors
in-
b) documentation and discussion of policies
STEP 3: Manual Preparation and Approval
STEP 4 : Inclusion of Housing Microfinance in Loans Program
and General Ledger

10. Introductory
Stage
• Pilot test in two (2) branches
• Zero availment on the first three (3) months of pilot testing
o July is not a good month to start construction and repair
of houses
o AO hesitant to offer new product (new documentation
requirement procedure for group lending)

11. Introductory Stage
• One time orientation without follow through in
process and procedure is ineffective for new
products.
• We pilot-tested HMF during the peak season for loan
pilot-
renewal of existing clients.
• Bangko Kabayan was not able to roll-out HMF on the
roll-
1st semester of 2009 and was delayed by six (6)
months.

12. Introductory Stage
Product roll-out was delayed because…
roll-
..preparation & approval of Process and Procedure
Manual took a lot of time
..our MF department focused more on strengthening
existing loan products to achieve growth for 2009
..there was quite a number of scheduled renewals
from existing clients

13. Moving
Forward
• After the MABS roundtable on HMF, our Supervisors realized that HMF
loans did not need to have large amounts and that simple house
renovations could be accommodated.
• Bangko Kabayan’s GABAY Housing Loan has shown remarkable growth
since its pilot test (Sept. ’09)
• As of April 2010, it has total releases of P5.5 M, a portfolio of P3.9 M with
232 accounts and 0.43% PAR.

14. BK HMF Loan Status
Performance

15. Future Plans
Continuous marketing of GABAY Housing Loan to all
eligible MF clients
Roll-out to regular depositors
Roll-
Maintain zero percent (0%) PAR through proper account
management
Continuous product innovation

16. Impact of HMF
1. Bank and Management
 Additional product to offer for the clients
 Good opportunity and competitive
advantage
 Additional loan portfolio

17. Impact of HMF
2. Account Officer
 Additional portfolio that may be
considered for incentive
 Helps the account officer acquire new
clients by offering good opportunities
not only on their business but also in
their status of living

18. Impact of HMF
3. Microfinance Clients
 Availment of additional (incentive) loan
with a lower interest rate and a longer
term
 Diversion of funds for their business can
be avoided
 Improve their status of living

19. Marigel Luz
Loan Amount: P 15,000.00
Project: Improvement of Kitchen and Bath Room
BEFORE AFTER

20. Marigel Luz
Loan Amount: P 15,000.00
Project: Improvement of Kitchen and Bath Room
BEFORE AFTER

21. Evangeline Banila
Loan Amount: P 9,000.00
Project: Wall Painting
BEFORE AFTER

22. Nenita Magtibay
Loan Amount: P 20,000.00
Project: Partitions of 2 Bed Rooms and Wall Finishing
BEFORE AFTER

23. Riza Capinding
Loan Amount: P 9,000.00
Project: Repair of Ceiling and Wall Painting
BEFORE AFTER

24. Mila Rosales
Loan Amount: P 13,000.00
Project: Improvement of terrace precast and flooring
BEFORE AFTER

25. Protacia Lorzano
Loan Amount: P 50,000.00
Project: Kitchen Improvement (flooring, walls, sink,
cabinet)
BEFORE AFTER

26. Jasmin Lat
Loan Amount: P 50,000.00
Project: Construction of Sari-sari store
Sari-
BEFORE AFTER

27. Edna Honrade
Loan Amount: P 40,000.00
Project: Construction of Ground Floor and additional room
BEFORE AFTER

28. Dulce Merano
Loan Amount: P 15,000.00
Project: Fence Improvement and Water Tank
BEFORE AFTER