This paper discusses the ways in which rural banks and a NGO-turned rural bank in the Philippines have made Grameen banking a highly profitable product.
The paper discusses:
* Poverty in the Philippines and the lack of access to financial services for the very poor;
* The lack of success of initial attempts in the Philippines to replicate the Grameen Bank approach;
* Peopleââ?¬â?¢s Credit and Finance Corporation (PCFC) and its method of replicating the Grameen model, ââ?¬Å?with great cautionââ?¬?;
* The establishment of the Center for Agricultural and Rural Development (CARD) as an NGO in 1986;
* Its successful replication of Grameen technology, with some modifications;
* Its establishment of a rural bank and the following growth and expansion of outreach.
The paper finds that:
* The success of CARD initiated a process of conversion of credit NGOs into rural banks;
* This process constitutes the mainstreaming of Grameen Banking in the Philippines;
* The Grameen model is highly effective in terms of outreach and profitability;
* The ââ?¬Å?Producers Bankââ?¬? is an example of how success can be achieved by following the Grameen method.
The paper lists lessons learned from the case studies. It concludes by discussing the following three sound practices that constitute the core social capital of the original Grameen approach:
* High moral commitment of leaders;
* Peer selection and peer enforcement;
* Credit discipline.
