Lamac Multi-Purpose Co-operative was set-up in 1973 by 70 small-scale farmers from the Lamac village (a small village in the mountains of central Cebu). The cooperative was started with the support of the Department of Local Government and Community Development (DLGCD) to provide consumer and marketing services for its members. In its early years, the cooperative worked with the DLGCD to implement vital infrastructure and services (such as electricity and potable water) to this isolated and poor community. A predominantly agricultural community, over the years the cooperative received growing demand from local farmers for access to credit to ensure increased productivity on their farms. However, it was not until 1992 when LMPC was able to offer its first line of credit to its members. Starting with just $500 shared between 40 farmers, LMPC has since grown (with the help of the Land Bank of the Philippines) to an operation of 22 branches (throughout the province of Cebu with a small presence on the islands of Leyte, Bohol and San Carlos) with over 50,000 members.
What is LMPC’s mission?
LMPC’s mission is to respond holistically to the needs of vulnerable sectors of society through socio-economic programmes. Members of the cooperative are not only entitled to access capital, they are provided extensive financial and non-financial training and supported in market linkages. Committed to its origins, LMPC’s target members are farmers and within this group, the Cooperative particularly targets women, youth and people with disabilities.
What types of financial services does LMPC provide?
Primarily, it provides micro-loans, insurance and savings facilities to its members. Loans range from $1,000 or less for groups of women who wish to start very small scale income-generating projects to loans for SMEs and social businesses. In addition to enterprise loans, LMPC offers credit for consumption and agriculture. Most members (apart from the very poorest) are obliged to pay a minimum annual membership fee of approximately $5 a year and are encouraged to save each month. Borrowers are expected to save approximately $1 a month during the length of the loan term and earn interest on these savings. The total number of borrowers as of the end of 2013 was 19,320 from a membership of 53,757 – approximately 36% of members are borrowers. LMPC share any profits with their members in accordance to their share capital.
How much interest does LMPC charge?
Microfinance institutions (MFIs) charge higher rates of interest for several reasons. Firstly, the administrative costs of making many small loans are much higher than making fewer larger loans; secondly, they take more time assessing the feasibility of applications and thereby reducing risk because borrowers cannot offer traditional forms of collateral nor do they have salaried incomes; thirdly MFIs often operate in geographically remote areas with low population densities and this means that they incur greater operational costs; and fourthly they often accompany loans with a range of training and technical advice. In addition, inflation is generally higher than in countries such as the UK. The rate of inflation in the Philippines can be found below. LMPC charges annual interest rates of between 18-36% per annum on a declining basis.
Does LMPC provide any training?
Yes, it provides extensive training in addition to running a number of community outreach programmes that are available to its members. Training and programmes such as:
· Financial literacy and marketing training
· Business development and market linkages support
· Training on crop diversity and sustianable farming methods
· Training on savings and cooperative ethics
· Promoting gender equality among cooperatives in the Philippines
· Community sesssions on maternal health and water and sanitation
· The cooperative youth group
· Disaster relief and preparedness.
Where can I find out more information about LMPC?
Further information about LMPC can be found at this website http://e-cooptrade.com/index.php/infocus/381-lamac-multi-purpose-cooperative or on Mix Market.
LMPC: Basic facts and figures
|Full name:||Lamac Multi-Purpose Cooperative (LMPC)
|Established:||1970 (started disbursing loans in 1992)|
|Average loan size:||US$585|
|Number of active borrowers:||19,320|
|Number of depositors:|| Awaiting information
|Gross loan portfolio:||$11,771,690
|Proportion of members who are women:||71.0%|
|Portfolio at Risk (PAR) at 30 days:||8.36% (as of September 2014)|
(This information was true at the end of December 2013)
Philippines: Basic facts and figures
|GDP per capita (current US$):||2,872.5|
|Human Development Index ranking:||115 (of 188 countries)|
|Proportion of population living on less than $2 per day:||45%|
|Adult literacy rate:||97.5%|
|Under 5 Infant mortality rate (per 1000):||28|
|Life expectancy:||73.01 years|