1. Designing a Housing Microfinance Loan Product TRAINING WORKSHOP FOR BANKS INTERESTED IN OFFERING HOUSING MICROFINANCE OR SIMPLY CURIOUS ABOUT IT

2. What is it? What is BSP Circular 678? Why Housing Microfinance for your Bank? –Crafting Objectives for your bank MABS Framework for Designing a Housing Microfinance Product

3. “The application of microfinance principles and methodologies to the provision of shelter finance.”* - small loan amounts -alternative forms of collateral -character & cash flow- based lending - regular amortization - short-to longer-term */ CGAP Home Improvements Home Construction House/Lot Acquisition

9. ME loan product HMF Longer Repayment Term: up to 3 to 5 years Larger loan size up to P300K Short repayment term: Not more than 12 months Small loan size up to P150K BSP recognizes loans for housing to low income groups as microfinance but with loan amount and term that may extend beyond P150k and 12 months, respectively.

10. BSP guideline allows up to 15 years to pay a loan for new housing Requires cash flow analysis LOAN SIZETERM UP TO 15 YEARS UP TO 5 Years BUY OR BUILD NEW HOME: Up to PhP300k HOME IMPROVEMENT: UP to P150K

11. 11 Better Credit History Improved Asset, Shelter & Home-based Enterprise Stronger Community & Economy OUTPUTS Finally, Housing Microfinance Outputs

12. 12 Stronger Community & Economy Microfinance is no silver bullet for poverty, but it does have things to offer. builds dynamic institutions that deliver inherently useful services to millions of poor people. builds businesses and offers financial services for the poor including microcredit, savings, microinsurance, money transfers & housing too.

13. Role Play: Convince the mock Board of Directors to implement Housing MF in the bank –Divide participants in 2 groups – one pro and one against –The groups’ output will be presented to a mock Board on Day 3 5 minutes for group consultation 1 st argument presentation – 3 minutes each 2 Rebuttals – 2 minutes each Synthesis

14. Bank Competitive Edge Client retention Diversifies MF loan products Expand portfolio Improve field staff productivity Increase profitability Clients No hard collateral required < PhP50K; in some banks, up to PhP100K Fast loan approval Longer loan tenor Regular affordable installments based on cash flow, debt payment capacity Clients decide what home improvement to undertake

15. Workshop: Group by bank – Craft your own bank’s objectives for offering HMF loan product 5 – 10 MINUTES

16. Thank you!