Mainstreaming Micro
PinoyME Foundation – the Pinoy MicroEnterprise initiative founded by former President Corazon Aquino – just held a stakeholder’s conference on the theme ‘MAINSTREAMING MICRO’.
The invitation from Dan Songco, President and CEO of PinoyME, read :
“While microfinance and microenterprise development continues to evolve, the microentrepreneurship sector is faced with growing opportunities and pressing issues that must be addressed in order to fulfill microentrepreneurship’s promise in helping the poor move out of poverty.
The Philippine Microentrepreneurship Stakeholders Conference aims to assess the current situation and discuss a proposed policy agenda derived from an extensive survey of literature and roundtable discussions of policy experts and institutions. The conference aims to gather a broad constituency behind this proposed agenda in the hope of promoting collaboration among the different stakeholders in the sector and put microentrepreneurship in the mainstream of Philippine social and economic concerns.”
This theme of transitioning microentrepreneurs from micro to SME is at the core of the work we do in Hapinoy, and as such I decided to attend. The conference was well-represented with more than 100+ attendees from stakeholders in academe, donor/funding agencies, development organizations, corporate foundations, microfinance institutions, social enterprises, commercial banks, and government institutions. There were even quite a few familiar faces whom I last saw in the Eradicating Poverty Conference held last November in Cebu.
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Program Schedule of the Mainstreaming Micro Conference
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The crux of the conference was a proposed Policy Agenda on the state of the microfinancing industry – as well as policy implications on it scaling across the country. It was authored by core members of the PinoyME research consortium, which is strengthening its knowledge base and research on the sector.
The Policy Framework has four major components : Progress (increasing market opportunities for microentrepreneurs), Impact (increasing MFIs’ impact on reducing poverty), Access (increasing access of poor people to financial services), and Outreach (increasing outreach of microfinance to rural, hard to reach areas).
These (4) major areas were processed in groups through consultative workshops and dialogue.
I myself joined Workshop #4 on Progress, wherein we tackled the question “How can we enable microfinance clients to graduate into small enterprises?”. The group was moderated by Mr. Jerry Pacturan, Executive Director of PDAP (Philippine Development Assistance Program) with discussants Lanny Nanagas, Chit Juan, Jerry Clavecillas, and Vic Roaring.
There were some common threads that lined our group’s discussion.
One thread was the reality that not all microentrepreneurs want to transition into small entrepreneurs. This is something we’ve certainly experienced in Hapinoy and as such, we have (2) levels — 1. Hapinoy Community Stores that act as the depot/distributor/leader to 2. the smaller Hapinoy Stores. Typically, our CS owners are those that have more drive, ambition, and vision both for themselves and their businesses. They also provide role modeling and a provide leverage in multiplying our impact.
Another thread was the model of development itself — should we be focusing on providing microfinancing/microentrepreneurship, or is it better to put energy behind SME’s and job creation? I personally think that it should be a balance of both. Job creation would be the relatively easier path; but it is microenterprise development that could provide fertile ground for those diamonds in the rough that will eventually become small-to-medium-sized businesses. Also, microfinancing provides the larger outreach that SME’s might not be able to scale towards.
Another discussion thread was the role of Microfinancing Institutions vis-a-vis Business Development Services. Should MFI’s be doing both? Or should they be entirely separate institutions? Our experience with our MFI partner CARD is that they are able to straddle both, although we at MicroVentures are also fulfilling additional BDS services for them.
The last thread – and the main point that i was really driving at – is creating an environment that cultivates and supports microenterprises. On this point, my main belief is that we need infrastructure and institutions that are microenterprise-friendly, as the current environment is decidedly not so. We need better policies for taxation on microenterprises as they integrate into the formal economy; We also need physical infrastructure – whether it be access to roads, energy, and market linkages. While access to financing has been cracked by the MFI’s, it is this whole other slew of needs that also have to be addressed if we do indeed hope to mainstream the micro.
Unfortunately, I wasn’t able to finish the conference but I’m most certain that the conference went well. More details on PinoyME’s website.
