UPSCALING MICROFINANCE ENTREPRENEURS TO SMEsXVI Inter-American Forum on Microenterprise (FOROMIC)

Guadalajara, MexicoOctober 01, 2013

INTRODUCTION

• CARD MRI Vision : CARD MRI is a world-class leader in microfinance and

community-based social development undertakings that improve the quality of life of socially and economically challenged women and families towards nation building.

• CARD MRI Mission : CARD MRI is committed to : - empower socially and economically challenged women and families

through continuous access to financial, microinsurance, educational, livelihood, health and other capacity-building services that eventually transform them into responsible citizens for their community and the environment

- enable the women members to gain control and ownership of financial and social development institutions

- partner with appropriate government agencies, private institutions and people and community organizations to facilitate achievement of mutual goals

WHY DID CARD DECIDE TO GO INTO SME BANKING?

The Issues• Successful and growing micro

businesses have outgrown the service and product offerings of CARD NGO and/or CARD Bank Inc.

• Maximum loan disbursed to micro’s is PHP150,000 or about $3,500 (recently been increased to PHP300,000 or about $7,000, if MFIs comply with requirements).

• Banks will not lend to micro’s on clean basis – ask for real property as security.

CARD’s Solution• Expand CARD’s offerings to address

the larger needs of expanding micro businesses – with new products and services.

• Be able to grant loans of up to PHP5 million in value (about $116,000) using more appropriate credit evaluation methodology.

• Cash flow based lending so that borrowers are not necessarily required to have hard collateral.

The CARD SME BANK, INC.- A Thrift Bank• Established in July 2011• Main Goal “ A regular thrift bank but with an extra-ordinary objective of

eradicating poverty (especially in the rural areas) by pushing and providing incentives to emerging SMEs in the agricultural sector and to countryside businesses with an end-goal of creating wealth and generating employment in the community”

• Preferred Target Market - microfinance graduate clients (CARD clients) - untapped/underserved rural SMEs (non-CARD clients)

The CARD MRI Business Model

CARDBank

1997

CARDSME2011

CARDInc.1986

CARD MRI’s strong commitment to poverty eradication!

• The CARD MRI Business Model

WHERE IS CARD SME NOW?

INDICATOR AS OF AUGUST 2013

Total SME loans disbursed (USD) 7.5 million

Total SME loans outstanding (USD) 4.1 million

Total number of active SME clients 4,658 (including “incubation” SME clients)

Percentage women clients / clients in rural areas

at least 90% for both indicators

Percentage of 30-day non performing loans (NPL)

6.82%

Thank You