Microfinance Credit Bureau: Experiences from the field


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Mr. Leonilo "Topper" Coronel of the BAP-Credit Bureau gives updates about credit bureau services such as the Microfinance Data Sharing System (MiDAS) tailor-fitted for banks and other institutions engaged in microfinance.

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Microfinance Credit Bureau: Experiences from the field

  1. 1. THE MICROFINANCE   DATA SHARING SYSTEM   (MiDAS)    Leonilo “Topper” Coronel   BAP Credit Bureau    2011 RBAP‐MABS Regional Roundtable Conference  Hya= Hotel & Casino, Manila  November 9, 2011  
  3. 3.   The MiDAS Journey  END •  MOA Signing, and Road shows Dec Sept  •   Final review and   acceptance  May  •   Launching of Pilot Phase  Apr  •   MiDAS ApplicaLon Development   Mar  •   MOU Signing  and FinalizaLon of  Terms  Feb Of Reference 2011 •   Planning Conference in Iloilo 
  4. 4.   The MiDAS Journey   The RBB Foundation plays a key role as catalyst to match needs against resources while the BAP Credit Bureau develops solutions, operates the infrastructure and provides services.  Historic meeting of the minds among major MFIs to implement a credit bureau facility that enables them to stay true to their social mission of poverty alleviation  Share data to identify and offer reform programs to borrowers at risk rather than build a traditional negative list of clients to be used as a caution list .
  5. 5.   The MiDAS Journey   Multi-borrowing not a primary objective, but system features partly address this.  MFIs provides the vision, strategic directions and specific business requirements for the project.
  6. 6.   The MiDAS Journey Core Group of Institutions and Initial Project Scope Negros Women for CARD Bank, Inc. Tomorrow Foundation, Inc. ASA Philippines Taytay Sa Foundation, Inc. Kauswagan, Inc. OK Bank, Inc. Ahon Sa Hirap, Inc.LifeBank Foundation, Inc. CARD NGOLifeBank Rural Bank RBB Foundation BAP Credit Bureau, Inc.
  7. 7.   The MiDAS Journey    Technical Working Group composed of senior representatives from 6 MFIs agreed on definitions, scope, reports, desired service levels by first week of March (Business Requirements)   6MFIs signed an MOU with RBB FOUNDATION as project manager on behalf of the MFIs and BAP-CB as service provider
  8. 8. MIDAS Business Requirements  –  Borrowers At Risk ClassificaNons  Value Description 01-01 FRAUD – ride on / loan sharing / dummy loans 01-02 FRAUD – non remittance of collections 01-03 FRAUD – getting commission on loans released of other members 02-01 ABSENCE / DISAPPEARANCE 03-01 UNDER LITIGATION 04-01 WRITTEN OFF ACCOUNTS / BAD DEBT ACCOUNTS 05-01 MATURED LOANS 06-01 DROP OUT – loan paid by center/group/co-member 06-02 DROP OUT – expelled by center member Restructured loans that incurred at least 2 missed payments w/o valid 07-01 reason 99-99 OTHERS
  9. 9. MIDAS Business Requirements   Barangay Level –  List all BAR in a given barangay as reported by participating MFIs as of a certain date –  Follow the official list of provinces, cities/municipalities and barangays posted on the website of the National Statistics Coordination Board (www.nscb.gov.ph) which is the primary reference for BAR reporting and BAR search by area.
  10. 10.   Key Agreements with Future MiDAS Participants 1.  Reciprocity o  Give = GET o  Voluntary vs. Mandatory2.  Confidentiality o  Info limited to those who are authorized w/in the institution o  Anonymity of reporting institutions3.  Retention o  No prescription o  Obligation to report any resolution in BAR
  11. 11.   Key Agreements with Future MiDAS Participants 4.  Required Reports o  Every 15 days o  BAR - CategoriesBAR TYPE   Value   DescripLon 01‐01   FRAUD – ride on / loan sharing / dummy loans 01‐02   FRAUD – non remi=ance of collecLons 01‐03   FRAUD – geXng commission on loans released of other members 02‐01   ABSENCE / DISAPPEARANCE 03‐01   UNDER LITIGATION 04‐01   WRITTEN OFF ACCOUNTS / BAD DEBT ACCOUNTS 05‐01   MATURED LOANS 06‐01   DROP OUT – loan paid by center/group/co‐member 06‐02   DROP OUT – expelled by center member   Restructured loans that incurred at least 2 missed payments w/o   valid  07‐01 reason 99‐99   OTHERS
  12. 12.   Key Agreements with Future MiDAS Participants 5.  Ownership and Governance o  Data belongs to participating MFIs collectively o  Create an entity to own and manage MiDAS going forward o  RBB Foundation plays only an interim role6.  Cost o  Annual Membership Fees
  13. 13. Who are MIDAS Eligible Participants?    Microfinance NGOs  Cooperatives  Rural Banks with MF operations  Eligibility Requirements:   A member in good standing of and endorsed by a microfinance council, network or association e.g. RBAP or MABS
  14. 14. Key Agreements After Pilot Phase    Acceptance of MiDAS as evidenced by Certificate of Acceptance  Populate system with nationwide data  Preparation of MOA
  15. 15. Thank you.