SUCCESS STORY OF TUBAO CREDIT COOPERATIVE Compiled by: Jacqueline L. De Leon & Jo B. Bitonio Cooperative Development Authority Dagupan Extension Office January 2012I. BRIEF HISTORY Forty-six (46) years ago on August 13, 1966, the Tubao Credit Union, Inc. (TCUI) as was officially called, now Tubao Credit Cooperative (TCC), was established with an initial capitalization of a mere P314.00 from 39 founding members through the initiative of a certain Belgian Missionary Priest by the name of JAIME QUATANNENS that the cooperative came to be. The purpose was to alleviate the economic condition of the people from unscrupulous money lenders or loan sharks and to uplift their quality of life. TCC was registered with the Cooperatives Administration Office (CAO) under RA 2023 and approved on October 22, 1966 under Registration No. 001503. In compliance with PD 175, it was re-registered with the Bureau of Cooperatives Development under No. FF-030- RR in accordance with RA 6938 (The Omnibus Cooperative Law). It was confirmed by the ooperative Development Authority (CDA) under Confirmation No. 543.
Not long after its organization, REVEREND FATHER EGBERT KRAYKAAMP,continued the work. Steeped with cooperative knowledge and expertise, through hisspiritual and academic guidance coupled with the unified and sacrificial efforts of the 5-member Board: the Treasurer-Manager and the committees with the presence of an ICMreligious sister in the Supervisory Committee – growth in membership began to beevident and operations gained momentum. Subsequently, REVEREND FATHER NORBERT LIETAERT came in as the ParishPriest. Of equal zeal for love and service to the parishioners of Tubao, he continued theeffort of his predecessors. In his desire to help boost the development of the TubaoCredit Union, Inc. and the quality of service rendered to members he offered the easternportion of the Father’s Convent as its permanent office, rent free. During its early years, the TCC was met with a “wait-and-see attitude” and otherunfavorable reactions due to people’s negative experiences with other organizations.This was then taken as a challenge and made “service above profit, above personal gainor interest” their battle cry.II. LOOKING BACK WITH PRIDE: FROM SMALL BEGINNINGS TO MILLIONAIRES The Tubao Credit Cooperative, the pride of the Municipality of Tubao emerged asthe Shining Star of Region I. Its main office is strategically located at Poblacion, Tubao,La Union, a walking distance from the Pepito’s Park, Catholic church, Municipal Halland other establishments and institutions of the municipality. With its growingmembership all over La Union, a P20M building is now standing majestically atBarangay Disso-or, Bauang, La Union along the McArthur National Highway. For forty-six years, the cooperative has touched the lives of its members andresponded to the emerging needs of the communities within its service area – the entireprovince of La Union, Baguio City, Tuba and La Trinidad, Benguet.
Envisioning it to be A GLOBALLY COMPETITIVE CREDIT COOPERATIVE, theTCC is geared towards uplifting the socio-economic conditions of the members throughits various financial products and services.A. MEMBERSHIP Originally, membership in the TCC was limited only to residents of Tubao, LaUnion, but as years passed by, the neighboring communities clamored for membershipdue to their belief that the Tubao Credit Union Inc. can respond to their growingeconomic needs. With only 39 founding members in 1966, a tremendous increase inmembership was notable. As of December 2011, membership reached 25,392. Majorityor 70% of the membership come from the agriculture sector. If you are a resident of the Tubao Credit Cooperative’s service area, membership iseasy and simple, just bring the following requirements: 1. Sponsor – member of good standing for at least three (3) years. 2. Any one of the following: Birth/Baptismal/Marriage Certificate 3. Any one of the following: SSS, GSIS, Passport, Company ID, PRC, Postal, Driver’s License, etc. 4. Current Residence Certificate 5. 2 recent photos (2x2) 6. Membership/Application Fee of P200.00 7. Minimum Fixed and Savings Deposit of P2,000.00 for ages 13-50, P3,000.00 for ages 50+1 day to 60 and P4,000.00 for ages 60+1 day to 70. For those over 70 years old, they are accepted as members but depositors only.B. ADMINISTRATION 1. BOARD OF DIRECTORS
As the cooperative gained its momentum for progress and development, therewas a felt need to increase the number of Board of Directors from the original 5namely: Gregorio M. Mapalo Sr. (Chairman), Constante L. Tino (Vice-Chairman),Josephine S. Lachica (Secretary), Isabelo A. Gonzales and Jose Z. Tavares(Member), to eleven (11) elected by the General Assembly and two (2) Ex-Officiodirectors namely the Manager and the Spiritual Director. As a policy-making body, the Board of Directors promulgates policies towardsthe attainment of the vision, mission, goal and objectives of the cooperative.2. COMMITTEES To aid the Board of Directors in its mandate to formulate policies, the different Committees work hand in hand with the Board of Directors in the latter’s legislative functions through their recommendations and all other matters relative to their mandated duties and responsibilities.3. MANAGEMENT The day to day affairs of the cooperative is entrusted to the management.Originally, there were only three part-time employees; Manager-Treasurer,Bookkeeper-Teller and Appraiser-Clerk. And now the Tubao Credit Cooperativehas 16 full-time employees serving 25,010 members. The satellite office at Disso-or, Bauang, La Union is manned by four (4) full-time employees. With the superb credibility of the management, Tubao Credit Cooperativenever experienced managerial crisis. Evident thereto is the fact that the late Mgr.Jose Z. Tavares served from its foundation in 1966 up to his retirement in the year2000 (34 years of service). He was succeeded by a career employee who rose from
the ranks – from Clerk to Treasurer, to Assistant Manager, then to Manager in the person of Mr. Romulus F. Layug. 4. GENERAL MEMBERSHIP/ASSEMBLY As per cooperative organizational structure, the highest policy-making body and the final authority is the General Assembly.C. CAPITAL/ASSETS In 1966, the starting capital was only P314.00, but in just a matter of 9 productive years, the Tubao Credit Cooperative hit its first million mark with a Total Asset of P1.2M. On its Jubilee Year, Total Assets yielded at P37.90M as of December 31, 1991. On December 31, 2005, the cooperative stood at P435.76M in Total Assets. On the last day of December 2011, Tubao Credit Cooperative posted a Total Asset of 629.92MD. BENEFITS For the year 2011, a member-borrower received a Patronage Refund of 19% and a dividend of 13.7% on Share Capital. While non-borrower received 12% dividend on share capital plus 3.4% additional incentive. In addition to the above-stated benefits, a member attending the Annual General Assembly meeting received a meal allowance.E. SERVICES OFFERED 1. LENDING/LOANS Particular/s Before Now/At Present
a. Loan ceiling P5 then gradually increased P300,000.00 for individual to P20, P30, P50 & P100. From P400 gradually scaled up to P1,000, P3,000, P5,000, P10,000 & P15,000. b. Loan ceiling for couples P27,000 P500,000.002. KINDS OF LOANS a. Providential loans – to provide future and immediate needs of members such as but not limited to medical, hospitalization, educational expenses, etc. b. Productive loans – include commercial and agricultural loans for farm, equipment, business and other farm needs. c. Jewelry loan – in view of the high interest rates demanded by pawnshops and other similar financing institutions, the cooperative approved the use of jewelries as collaterals with “no interest” in adherence to its “service above profit” policy. d. Housing loan – assistance for employees with a maximum amount of P1.5M, payable within 10-20 years.3. OTHER TYPES OF LOANS a. Barangay Officials Loan Assistance (BOLA) – offered to elected/appointed Barangay Officials and employees. A maximum of 70% of the annual honorarium may be availed of and shall be payable in one (1) year on a monthly or quarterly installment basis. BOLA was made available in March 2011 and as of December 31, 2011, a total of 21 Barangays from La Union have already a MOA with the cooperative. b. Micro-Enterprise Loan (MILO) – loan assistance for those that have small scale livelihood projects/business. This product was introduced last October 2011 and as of December 31, 2011, a total of ten (10) members have already availed. c. Pension Loan (PENLO) – loan assistance for our pensioners/retirees- members. Members may avail of this loan up to 5x or 9x their monthly pension and may be paid in 6 or 12 monthly installments. This product is already available since November 2011. d. Chattel Mortgage – Since December 2011, the cooperative is now accepting applications for loan with chattel as collateral. Collateral may include but not limited to automobile-private or publicly used, tricycles, farm machineries, etc.
4. DEPOSIT ACCEPTANCE Tubao Credit Cooperative accepts deposits as source of fund for its loaning operations. It offers its members competitive interest rates of 3% PA (net) for savings deposits and 5% PA (net) for time deposits, much higher compared to other commercial and financing institutions. Interest on savings deposit is computed quarterly (rate is not fixed – there are times when it goes up; and times when it goes down). The cooperative also have a Kiddie Savers Club with a total of 124 kiddie accounts and total deposits of P398,818.23 as of December 31, 2011.5. SOCIAL SERVICES For several years, the cooperative had extended Scholarship Grant to high school students of San Alberto Magno Academy (SAMA) but through the years, the Board of Directors came to realize that students can graduate high school but can not afford to go to college. Thus, the Board implemented the Full College Scholarship Program and Educational Assistance to accommodate more beneficiaries. Likewise, the coop has also extended financial and material assistance to both Public and Private Schools. At the community level, the cooperative works hand-in-hand with government and non-government organizations in the implementation of
various community programs, projects and activities such as medical missions, peace and order, religious endeavors, sports, etc.6. EDUCATION-INFORMATION PROGRAM Pre-Membership Education Seminar (PMES) held on site at regular schedules on a fix day every month is one of the requirements for TCC membership admission. An applicant goes through a seminar where he receives the basic knowledge on cooperative ideals, principles, duties, responsibilities, privileges limitations and benefits in a lecture-forum style. The philosophy of “NO MAN IS AN ISLAND” will enlighten him so as not to stand alone anymore. Continuous education-information drive is encouraged through contacts, consultations with officers and management or through interactions with other members who are fully equipped on cooperative learning as derived from lakbay-aral activities locally or internationally.7. MORTUARY AID SYSTEM (SARANAY PROGRAM) The mortuary aid program is one of the services that motivated/inspired members of the community to join the cooperative movement. Considering the expenses incurred when death occurs in the family, the Tubao Credit Cooperative in 1975 introduced the mortuary assistance to its members with the following categories: ages 18-50 – P2.00/death; 50+1 day to 60 years old – P5.00/ day and 60+1 day to 70 years old – P10.00/death. This program has combined features of membership expansion and capital build-up envisioned to be within
the reach and capability of the lowly members in the far flung barangays within the service area. Claiming mortuary aid is easy and simple. Just present to the Manager an official death certificate and on that very day, a partial amount is advanced, while the remaining balance can be claimed two or three days thereafter. This program protects bereaved beneficiaries from inheriting a deceased member’s debts if indebted to the TCC. As of December 2011, there were 20,422 members under the saranay program and the benefit or average amount given to every beneficiary is P27,983.44 net. 8. OTHER SERVICES a. Enhanced Housing Loan The present leadership is currently in its early stage of making the enhanced housing loan fully operational. A member-borrower who can qualify with all the requirements prescribed of the said loaning program can avail a maximum amount P1.5M payable in 10-20 years. b.Western Union Services The Bangko Sentral ng Pilipinas granted the TCC permit to operate Western Union money transfer and started offering the service last July 2011.III. FACTORS THAT CONTRIBUTED TO THE SUCCESS OF TUBAO CREDIT COOPERATIVE 1. Divine Guidance – TCC was started and initiated by priests. With God’s blessings; it managed to survive purely under the principles of SELF- RELIANCE, true CHRISTIAN SPIRIT and apostolic sacrifices of the past and present officers, management and members. 2. Honesty and Dedication – Learning to say no to members helped a lot in the disbursement of funds of the cooperative. The policy has instilled a discipline from among the members, and this is the reason why from the original 39 founding members of the cooperative have now 25,392 members as of December 2011. 3. Adoption of attainable and practical policies to conform to the regulations governing interests on deposits, real estate and jewelry collaterals as security of loan to protect the cooperative’s interest. The adoption and implementation of
meaningful and pro-members policies that match the needs of the situation and directed to benefit the greatest majority of members and not just a few. 4. Tax exemption privileges. 5. Efficient and effective management paralleled by the dynamic leadership of the Board in concerted efforts. 6. Practice of desirable attitudes towards people and work/employment starting from the Board of Directors, the Committees, and Management staff down to the lowest employee. 7. Observance of the three main disciplines that a credit cooperative member must follow: “save regularly, borrow wisely and repay promptly”. 8. Conservatism in spending – observance of operating procedures of cooperatives as to expenditures. 9. Rewarding benefits given to members at year’s end. All the members are satisfied with their benefits at the end of every year’s operation. 10. Strong membership support. 11. Guided by the cooperative’s vision, mission, goal and objectives. 12. The TCC strongly adheres to the international cooperative principles namely: a. Open and voluntary membership b. Democratic control c. Limited returns on capital d. Distribution of Net Surplus e. Continuous cooperative education f. Cooperation among cooperatives g. Religious and political neutralityIV. AWARDS RECEIVED Due to the outstanding performance of this cooperative, it received many awardsand a few are sited below:
• Plaque of Commendation for being a regional nominee to the CDA Gawad Parangal 2011• Mark of Gratitude in grateful appreciation of their invaluable support and assistance towards the successful implementation of various Cooperative Development in the Province of La Union given last October 26, 2011 at Diego Silang Hall, San Fernando City, La Union.• First Place – Outstanding Cooperative in the following dimensions: Assets, Paid-in Capitalization, Net Worth, Net Surplus, Membership and Volume of Business all in Ranked #1 (Provincial Level) CDA – October 2007, 2008, 2009 in Dagupan City, Vigan, Ilocos Sur and San Fdo. City, LU.• First Place – Outstanding Cooperative in the following dimensions: Assets, Paid-in Capitalization, Net Worth, Net Surplus, Membership and Volume of Business all in Ranked #1 (Regional Level) CDA – October 2008 in Vigan, Ilocos Sur.• Cooperative of the Year Award – (1st Place – Provincial and Regional Level) – For being a top performer cooperative based in net worth, paid-up, savings deposit, volume of business, net surplus and growth in membership. CSF October 24, 2007.• Excellence Award – for the commitment & dedication in pursuing the improvement of the quality of life of its members & for the active involvement & collaboration in various cooperative projects & for being socially responsible in helping the community. CDA March 10, 2007• Plaque of Appreciation – as top CETF remitter. NATCCO May 26, 2006• Plaque of Appreciation – as top depositor of the NATCCO Central Fund. NATCCO May 26, 2006• Recognition Award – in recognition of its over one million premium production and in appreciation for continuous patronage of CISP. CISP August 5, 2005
• Plaque of recognition – In pioneering in innovative ways of providing protection to its members through the Saranay Aid System, in setting effective delinquency control mechanisms and for adhering to the principle of self- reliance in the delivery of services to its members and the country. CUP January 26, 2003 • Certificate of Excellence (2nd Place Credit Category) – In recognition of the vital role in promoting self-reliance, the attainment of economic, sustainable development and social justice thus serve as a model for others to emulate and the exemplary contributions to the total development of the Filipino people. CDA November 9, 2002 • Special Award – for being one of the Most Outstanding Credit Cooperative. Dagupan City November 28, 2001 • Certificate of Recognition – for its exemplary credit services which generated innumerable livelihood projects that uplifted the economic well being of its members as well as the welfare of the whole community thru various Social Development Programs thus serving as Model among all cooperatives in the Province. San Fernando City October 20, 2000 • Trailblazer Award – for the pioneering efforts and every innovative approach in administering an in-house mutual benefit system known as Saranay Aid System over 25 years provided immediate assistance to the heirs of a departed member. CUP January 30, 2000 • Plaque of Recognition – for being one of the millionaire cooperatives in the province of La Union. October 30, 1998. • Hall of Fame Award (2 times) – for the most outstanding credit cooperative in Region I. November 12, 1995; for meritorious and dedicated service of invaluable contributions to the vision and mission of the Cooperative Movement in La Union. November 9, 1995. Finally, the Tubao Credit Cooperative Mission is to ensure survival and viability ofcooperativism as a collective enterprise as well as a way of life such that the socio-economicstatus of its members is alleviated. Thus, TCC is an economic vehicle, a mover, a shaker, and ashaper of financial stability of its members in particular and the communities it serves in general
and to compete locally and globally with other cooperative in terms of deposits, income, assetsand investments.