Some Notes on PDMS

In a week's time, we will launch a new website, www.pdmsplus.com. It will provide information on the Poverty Database Monitoring System and how it can be used to complement other planning tools, such as ecoBUDGET; how LGUs and CSO's can have access to PDMS; and updates on how the poverty database is used as pro-poor targeting tool by various projects.

While looking for articles to post, I found a memorandum-report which I sent to the BLDF staff some years  back, on 29 June 2009. I will post excerpts from this Memorandum to provide some background notes on PDMS during the early years. In 2009, the PDMS software was on its 6th year, as developed by the Senior IT Consultant, Tony Irving.

Here are the excerpts:

1.3       Just for the record because you know this yourselves, I recognize the valuable contributions done by the following institutions, agencies and individuals in translating a concept into a feasible pro-poor targeting and project monitoring tool which can potentially benefit a lot more LGUs and NGOs and their clientele among the world’s poor:

1.3.1    The late Atty. Juanito G. Cambangay who organized the database task force at PPDO in 2003 to find ways to establish a common platform to bring information from all existing databases and make it available to all users for planning and monitoring;

1.3.2    Rogelio Alegado (Note: Roger passed away more than a year ago), a member of the task force, who demonstrated the ranking of municipalities in Bohol using four indicators which was a pioneering effort to use available information manually processed to reflect poverty ranking;

1.3.3    Anthony Irving, a VSO volunteer recruited to assist the PPDO database task force, and who later became the programmer for the LPRAP software in 2004 and IT consultant to BLDF for a British-assisted project and is credited with technical enhancements leading to the current PDMS version 2.3;

1.3.4    Arnold Seloterio, BLDF Database Administrator, who served as counterpart staff to the IT Consultant as part of a capacity-building process for PDMS;

1.3.5    Mayors, Sandigang Bayan, and MPDCs of the initial 17 municipalities which agreed to fund the initial household poverty surveys in 2004 to 2005 when the project encountered problems in securing AusAID assistance;

1.3.6    British Embassy Manila c/o Joseph Imperial which funded a one-year project which enabled BLDF through IT Consultant Tony Irving to improve further the features of the software,  and through the Holy Name University Center for Local Governance to revise and field-test the survey methodology and questionnaires used;

1.3.7    Ms. Josephine Cemine and Maria Paz Espiritu of HNU who reviewed the survey questionnaire and methodology used and revised after pilot-testing recommended changes;

1.3.8    AusAID PACAP c/o Ms. May Blanco which promotes the use of PDMS in projects that it funds in Bohol;

1.3.9    Ms. Tonette Zablan and the CVSCAFT Research Department which conducted researches on how PDMS has been used by LGUs and NGOs, respectively;

1.3.10  Ms. Erin Hoffman, a graduate student from Boston College, who spent a 7-week internship with BLDF to assist in field-testing the ABCD methodology and survey guidelines to generate household and community information on assets for the PDMS.

1.4       During the last three years, it has been shown that the PDMS survey can be conducted and the survey installed not only by LGUs in Bohol, but other LGUs in the country, i.e. San Fernando City, La Union; Lucban, Quezon; General Santos City; Sultan Kudaratat, etc., and several non-traditional clients, e.g. a Catholic parish in Davao City. Abroad, PDMS was installed in Timor Leste and Solomon Islands.

1.5       As early as 2006, it was felt that a more focused and systematic way to replicate PDMS needs to be in place to make it available to a wide range of users.

1.5.1    Activities towards creating the LPRAP Support Center, later renamed the Poverty Studies Center, were included in the British-funded Strengthening Local Governance Project (SLGP). Although considered an output of the project, the PSC could not take off due to lack of funding to hire additional staff. The PSC was conceived due to the inability of the Provincial Government to provide  systematic support to LGUs and other PDMS clients on technical matters related to PDMS

1.5.2    In September 2007, soon after he retired, the late Atty. Cambangay supported the idea of forming a corporate body, the Institute of Poverty Studies and Responsive Governance, to address this problem of providing systematic support to LGUs and other clients on how to establish, update and use the household poverty database for their respective poverty reduction programs. Unfortunately, he passed away soon after having the SEC papers prepared and recruiting incorporators.

1.5.3    Meanwhile, the team of Tony Irving and Arnold Seloterio served as volunteers to provide technical assistance to LGUs regarding PDMS. While they were given fees for their services, but these were not commensurate to the tasks that they were doing. The LGUs owe them a debt a gratitude for these unselfish efforts on their part.

1.5.3    Part-time efforts to market PDMS abroad suffered setbacks on account of inadequate time to pursue clients. There was the technical issue raised about the link to DevInfo, the software used by the UN System to track the MDGs globally. While this was technically responded to by the IT Consultant, explaining it to prospective clients would require tremendous time and efforts.

1.5.4    While attending an urban planning workshop in Bangkok in 2007, I got wind of a new school of thought about community development. Rather than look at problems alone, this new approach identifies assets as basis for interventions in addressing poverty-related problems. This approach came to be known as ABCD or Asset Based Community Development to distinguish it from the basic needs approach which underlies most development methodologies and tools, including PDMS.

1.5.4.1 Pioneered at the Northwestern University in the US at the start of the decade, a few tools have been developed to date. Efforts have been made to replicate these tools in a few universities in the US and some other countries. In the Philippines, ABCD is relatively unknown except perhaps to some community development professionals.

1.5.4.2 We were able to follow up on an earlier request for an intern from Boston College. The college sent Erin Hoffman who was able to spend the first quarter of 2008 working as a member of the BLDF field team developing the survey methodology for ABCD in Anda and San Isidro. Later, the survey design was field-tested in Pilar.

1.5.4.3 Meanwhile, the IT Consultant, Tony Irving, was able to develop the ABCD component as part of PDMS software. Version 2.3 of PDMS has been installed in several municipalities in Bohol starting in late 2008. Thanks to the efforts of both Tony and Digoy and the LGUs and other clients which have funded conduct of the resurvey based on the revised questionnaire and the installation of the new PDMS version.

1.5.5    Arnold Seloterio, the local counterpart of the IT Consultant, left for Singapore to work. Digoy Ocarol took his place as Database Administrator as counterpart IT Specialist to Tony. BLDF could not give them regular pay. They have to generate income from contracts signed by BLDF with clients. In effect, they are project-based staff.

1.5.6    While I was able to help in promoting PDMS with EU project in Mindanao, my work with Habitat 
             International limited my efforts to do much else. 

Now we enter a new stage for PDMS with its version 3.0 developed with assistance from the EU-funded DReAMS' (Development of Resources for Access to Municipal Services) project. For the features of this new version, kindly visit www.pdmsplus.com. Three young volunteers are helping us put up this website: Daidee Padron, who serves as coordinator; Natnat Hinay, IT Specialist and Webmaster; and Charisse Aya-ay, researcher/artist. 

More exciting days ahead for PDMS and its companion tools. 

More on Microfinance

 Here is an input from Johannes Seian Manzanilla, based in Switzerland, as response to Microfinance Blues:

I read your Blog Entry about Microfinance and the people who do not pay back. And it made me think and wonder. This must be a very difficult situation for you and the foundation. What are your strategies to deal with this?

It saddens and disappoints me that those people you were trying to help, now refuse to pay back. But then can we really blame them? As you noted, is it a shift in our social values and culture? As I made my short research I see there are indeed organizations who successfully provide micro financing and I wonder how they do it.

In a forum I  found an interesting comment on the Grameen bank System:

"I've read Yunus book about the Grameen bank, and he explains the system (I don't know how Kiva and other companies follow that principle, but I assume they use similar because it was sucessful).
First, the bank doesn't come to the people, the people come to the bank: they see that a bank circle in the neighbouring village has made people more sucessful, or their relatives tell them about it. So the curious go and talk to an established circle of members, and learn the requirements: go out and get 5 interested members and form your own circle.

Then you contact the bank, and an employee comes along to your circle, explains all the rules (Grameen requires courses for health, contraception, no bride price, literacy etc.). Once everybody agrees to the rules and signs the contract, the classes start and bookkeeping.
The first credit will not be 500$, more like 5$ *. The circle decides on who needs it most and what to to with it - so a business idea must exist, and it must look reasonable.

The circle meets every week for strategy, classes, bookkeeping and also savings and repayments. (The bank can put in a clause that the members have to save up a certain amount first before gettin a loan to show dedication and financial responsibility).

If you look at it negatively, it's peer pressure; positively, it's feedback and social networking.

Also, most members of a circle are women; many experiences in 3rd world countries show that women think of their hungry children at home and save the money, where men tend to give in to despair and spend the money on alcohol or drugs or gambling. So this also contributes to higher rates of payback and savings.
Another point is that in these villages, everyones survival depends on the community. If you are outcast because you default and damage the society, you have no chance, except leaving the village, which is in itself a drastic step.

The people don't think of defaulting because usually Grameen gives them the chance to become productive and self-sustaining, with a steady business income or improved future for their children. They know they will never get a chance like this again elsewhere.

And the above mentioned entrance barriers - that people have to form the circle first, and agree to a contract, instead of the bank going around handing out loans to anybody vertical and breathing - means that the few poor people who don't have the motivation or power to run a business don't apply.

It's not true that most poor people are lazy or bad with money; most poor people are kept down through a combination of circumstances outside their power to change. The few people who conform to the stereotype of lazy or wastes money on frivioulous stuff just get all the headlines to confirm the clichees and for reasons of political agenda.

And the reason for the high default rates in the West is greed of the banks, not the creditors. Banks can do very thorough background checks for credits, or give a loan to anybody upright and breathing ...

Oh, and yes, the Grameen bank has very high costs because the employees have to visit all these villages every week to collect payments, do the bookkeeping until the women have caught up with their literacy classes, etc. It requires more effort than sitting in a AC controlled office waiting for your customers to come to you; but Yunus only hires people who are willing to go to their customers. Still, the rates are about 20 to 30 %, which would otherwise be cut-throat, but covers the services provided. Since these loans are investments in the future, and not new car type of loans, they are still a better choice than the usual cutthroat credit of 100% and more, and one default, and the only cow is gone, destroying all income.

(Some microfinance is run by Churches, like Brot für die Welt, which do the service stuff for free to help; an existing group structure makes things easier.)

Microfinance is so sucessful that scammers are starting to take advantage of this, pressing loans to people without the preparation and thus ruining them. So Grameen warns people to only use serious groups.
* 5$ may not sound much, but the example that started Yunus on his ideas was that of a woman weaving baskets or hats and renting the tools and buying the material each morning from the supplier, and getting the difference at the rest of the day was far too low despite working all day. When Yunus asked her how much she would need to break this cycle, she replied "5$" to buy the tools once and for all, and buy a small supply of material as start.

That got Yunus thinking, on how many more people he could help with small loans. " ###

Here is my reply:  

Much thanks for your input and the research. We must really go to the basics. I think along the way we were misled or were not too strict about the process to be followed. Client selection is important. We were too kind and charitable and failed to do proper character investigation. Also there are factors we cannot control. For instance, those affecting the enterprises that the people put up are subject to risks from the climate, competition from others, lack of marketing connection, etc. Anyway, we will get out of this messy situation. learn our lessons as an NGO and move on. 

Hannes, much thanks for the concern.

Advice from Levi Verora, Microfinance Expert

 On Microfinance Blues

Within minutes after posting Microfinance Blues, our friend and microfinance expert, Levi Verora, posted a response. Let me share this with you. Levi, much thanks.

 I would like to share with our FB friends, particularly those involved in microfinance, the following advice from Levi P. Verora, a microfinance expert, in response to my previous blog, Microfinance Blues:


hi nes. levi here. some points on microfinance of bohol foundation. microfinancing is supposed to bring hope to poor borrowers to rise above their situation. that has been the intention when Grameen Bank, Comilla Proshika, Proshika Comilla, and other MFIs were formed in Bangladesh. but a mindsetting (paradigm shift, they would say) had to take place among the all-women borrowers themselves till they formed part of a movement, a crusade to fight poverty.

now back to Bohol. microfinancing must be articulated fully well with the foundation's borrowers. they must have a mindset like that of the all-women, poor Bangladeshi borrowers. if that is not taken or made to ripe, the borrowers will not feel obliged to repay their loans and honor other obligations. second, there must be a way to spot and screen loan applicants. begin with an assessment of their character, then capacity to pay, then collateral (if any), then capitalization (equity or savings of their own), and finally capability to manage the loan amounts and grow out their businesses. third, there is no sense if they remain borrowers operating various livelihood endeavors.

there must be stinging ways to graduate them into micro and even small entrepreneurs, with growing businesses and networth. here, business advising and coaching will matter a lot, alongside compliant monitoring and evaluation. there are more points I wish to share, but the space is limited.  when I get to visit you one day, we'll talk about them. cheers.

Microfinance Blues

The other day I met with the finance committee of the Foundation composed of Dr. Pomie Buot, Myrna Angalot-Lu, Joy Arac and Joal Velas. They were worried that BLDF might not be able to pay back the loan amounting to the creditor by the end of this year. It was the same story as last year. Same problem - those who took out micro-loans, ranging from Php 5,000 to Php 15,000, have not been paying. Same faces. And, probably, same solution, I was telling myself as I listened to their woes.

Same reasons were given for the non-payment of the loans: the cooperatives could not sell their produce; there was no fish caught or no farm produce because of bad weather; the money was spent for tuition fees, medicines and other emergencies; they just could not pay, period.

The community organizer who serves also as collector of payments said the clients were getting harder to deal with. Some dared him to call the police and arrest them, knowing that this was against the law; others were just plain non-committal and would not give any pledge when they would pay; majority of them would give dates when they would pay the loans but from their past behavior you know they would not honor their word.

And so what to do? A number of options were again listed down, the same that were in those lists in countless meetings before, none of them worked: let them sign promissory notes; charge them in small grants court; get them to pay in kind, e.g. getting part of their harvest of rice, tomatoes, fruits, etc. None of these worked in the past; hence, how could these strategies work now?

We seemed to be running of options. Same analysis of previous lapses: we did not apply due diligence in the the choice of debtors; we listened  more to our partners about the selection of project sites which made us operate in places too far and expensive to reach; some of those who took our loans were approved by former employees, who are no longer around. 

Meanwhile, we have to maintain the collector in terms of monthly salary, fuel allowance for the motorbikes, food.

Most likely, we will again look for sources, other than the debtors, to pay back the loan. Same solution as last year. It is an expensive to pay for the lapses. We did not anticipate this kind of misbehavior, some of them we know have the capability to pay. Could it be that social values are shifting, people no longer honor their word? When they came, they were really quite dramatic in their depiction of their hapless situation. When it was to collect, they either disappeared or they pretended it was the first time they were meeting the collector.

The sad part is that there is no resource institution or agency we could turn to and tell our story. Success stories are what they tell each other during workshops which sound like fairy tales to us. How did the other NGOs manage their microfinance facility? What have been the lessons learned? This non-payment of loans, is this a common experience? Nobody seems to care and we are left on our own to solve this puzzle.

Chances are, the finance committee will again borrow money from their respective families and other sources of credit. Yes, we will end up poorer than the farmers and fisherfolk we have been trying to help.

Sad but true.

Discussion with the Academe on Poverty

Last 09 April, we had a three-hour session with some 19 representatives from several colleges and universities from different regions of the country. They were participants/resource persons of  the Philippine Transformative Approaches to Innovative Leadership (TRAIL) Summer Youth Camp organized by the Youth Leadership Excellence for Active Development (YouthLEAD) Philippines, in partnership with the Philippine Society of Young Good Citizens and the Bohol Alliance of Student Councils.

I was invited to serve as Topic Speaker on the subject, "Developing Social Impact in Student Governance."

We started the session by the participants citing what they considered as priority problems in their respective municipalities or where their academic institutions were located. As expected, all of them cited common problems such as: unemployment; lack of housing; inadequate health facilities; malnutrition; overpopulation; low agricultural productivity; poor garbage collection; logging; traffic congestion, etc. The other problems cited were "sex scandals" involving students; poor governance or political interference in development; drug addiction; vote buying; and lack of family values.

It was pointed out towards the end of this initial one-hour session that most of these problems could be traced to poverty while some problems were environment-related.

To provide a basis for the discussion on what to do with these problems, particularly at local level, e.g. college or community, I presented two tools which have been used in Bohol in efforts to address problems related to poverty and how interventions could be made using initially local resources.

I showed the key features of the Poverty Database Monitoring System (PDMS) software and used it to process the household poverty database of the municipality of Baclayon based on its resurvey last 2009.
For the new approach to providing interventions, I cited the content of the current 5-year Community-Based Eco-Cultural Plan of Baclayon, which is Bohol's first comprehensive application of the ABCD approach to local-level planning.

In their response to the presentations, the participants were cited the following:

• The solutions to poverty need not be generated from outside, but local resources could be identified to address poverty-related problems. 
• Projects with long gestation period may not be suitable for student groups to undertake on account of their temporary stay on the campus. 
• Advisers need to provide examples and guide student groups to link their plans and projects to problems related to poverty and the environment. 
• The school, the community and the family must work together to address poverty and that student activities must support initiatives along this line. 

There was limited time to explore further what specific ideas the advisers could explore with student groups in their respective colleges. The session was more of building awareness about a pro-poor targeting tool that could help ensure that households more disadvantaged than others could be identified and given immediate assistance by the local government and its partners. 

Post-Meeting Reflection 

Hours after the discussion with the advisers I was preoccupied on what could really be done by student groups given their limited time and academic load and still link their extra-curricular activities meaningfully to the global agenda on poverty reduction and sustainable development. 

Here are some ideas: 

-Collecting bottles and using them to reinforce rocks or other materials used in slopes to check soil erosion. 

Bottles of wines and liquor are not returned to the seller or supplier and they usually end up in activity areas in a town or in the garbage dump. In both places, they run the risk of being broken and pose a threat to the safety of persons or children. They cannot be sold; hence, they have no commercial value as far as the people are concerned. In Baclayon, efforts have been done to collect them and volunteers are trained at Balay Kahayag on how to use them to reinforce contouring in sloping areas. 

Just to find out how many bottles could be collected from a public area, such as the town's baluarte or pier, we collected bottles and counted them on 01 Apr and 05 Apr. We were a able to collect a total of 153 bottles in those two days, broken down as follows: Emperador Light, 116 (75%); assorted wine, 24 (16%); and Tanduay rhum, 13 (9%). The average number of bottles collected per day is 75. 

This involves only 1 collector with the help of two or three utility persons assigned to clean the baluarte area. 

Imagine if the advisers could mobilize student groups to collect such bottles all over a city or municipality where they are located and use them for other purposes, such as for saving the soil, etc. The impact will be quite great in terms of checking soil erosion. Perhaps some enterprising students will find some other uses for the discarded bottles and engage local communities in activities in livelihood projects using these bottles. 

-Conducting a survey on what exactly the families are doing in terms of livelihood and finding out their actual needs to scale up the livelihood activities in terms of better marketing, use of technology, improved design. Teams of students can be mobilized during their spare time to just walk around and do a survey with priority in more disadvantaged communities. The findings can help them formulate more relevant projects and at the same time, make them aware of the actual situation in their local communities, their problems and potential. 

I am sure there are many ways the advisers and the student groups can think of to relate their plans and projects to poverty and the environment. Our hope is that they will focus on identifying those who are most in need and identifying simple projects that could directly benefit them.