As follow up to my previous subject, herewith, I am sharing a response I made to Dr. Nelson Paguyo, creator of the Micro-Financing protocol of the Overseas Filipino Council International, Inc (OFCI), of which I am a member. This was his comment:
Good concept Freda. Good luck. I hope your advocacy is successful. No interest charged is noble.
1) How will you maintain the Micro-Financing program without interest to pay the people working for the program and/or to replenish the funds due to losses from non-paying clients/deadbeats and operational expenses?
2) How are you going to maintain the level of funding necessary to keep the program going? Is it by fundraising/donations?
Your sharing of information is appreciated to enhance OFCI’s MF program.
In the OFCI MF protocol, debts are forgiven if and when the borrower can not pay the loan.
And here was my response:
Thank you so much Doc Nelson for taking time to respond to my post. And for commending my advocacy and wishing it well.
My micro-financing and loaning program is unique and special in a way, because, as previously mentioned, I do not impose any interest and repayment is dependent on how much the borrower can afford to pay. It is unique because funds are solely coming from my pocket, which, through the years since I started working overseas (1987), have gradually increased. And even when I ceased working because of ill health in 2002, I continued infusing funds through a special circumstance of receiving a substantial monthly allowance from my husband, just like I am still receiving a salary from work. I actually liken it to having profits from a business, a steady income, which, for as long as I am married to Waleed, will never stop pouring.
Now, I can, of course, use the money to buy whatever I fancy for myself, but I opted otherwise. This is where my advocacy now comes in – that idea of sharing one’s wealth to the poor without any strings attached.
Let me tell you how I do it. The funds, which are all currently out with the people, are being recycled, meaning that whatever is collected goes to whoever is next in line. Losses, by way of non-payments by a few who are irresponsible, have now been minimized by requiring a loaner to hand over his/her ATM card as assurance of payment. This is in cases of the employed or pensioners borrowing 20K pesos and above. These are the loaners whose ATM cards were previously being kept by loan sharks. [I now aim to save as much relatives from the clouts of these uncaring lenders who can take, without any qualms, everything from whatever amount is entering the ATM! I have actually now started to expand, covering even those who are far].
As to the poor and unemployed, when borrowing capital for a small business, or for any urgent needs, I only give to those who are within my reach, within my local community here in Mapatag and are required to pay weekly. In cases of consumer goods business, like a sari-sari store, I allow a re-loan even when the principal is not fully paid yet. This is to ensure the sustainability of the business. Same way as in the case of a tricycle business, I allow re-loan for repairs and maintenance.
Aside from my full scholars and the regular ones – nephews and nieces and now grandchildren from my siblings – I also am into a “study now pay later” program where I cover everything including on-the-job training fees and expenses in applying for a job once graduated. Other students within my radar are also being helped by advancing their tuition fees whenever their parents’ salaries get delayed.
Fund is expected to increase steadily in the years to come as those who are directly under my support become independent. Not unless my list of salaried workers expand, of course. These workers alone, including my PA who is charged with collecting payments, are taking a lot from my monthly allowance, not to mention the regular budget for the improvement and maintenance of my properties including special projects which are being undertaken for the sole purpose of providing livelihood to the poor. I never aim for profit, just as in the publication of my first-ever book in 2007. Proceeds all went to a number of health-challenged individuals. And whatever income I get from writing and editorial works also go to my charities.
Now, you may ask why I do what I am doing. I believe in Allah, my one true God, Who has commanded me to care for those who are less privileged in life. And one way to show you really care is by not taking advantage of anyone. For me, usury is a sin, a very grave sin!
And of course, I do what I do because it makes me happy