What is the most challenging part of this pandemic that prevents one cooperative from adjusting to the new normal? Answers have ranged from getting new customers, poor internet connections, delinquency, liquidity, mobility of people given travel restrictions, fintech adaptability and issues in loan collections.
Given these issues, how are cooperatives adapting? Mr. Felimon Espares, CEO of Barbaza Multipurpose Cooperative in Antique, talks about its operations there. Visayas is not as affected as compared to Luzon, which is under Enhanced Community Quarantine (ECQ). He acknowledges that there is both pressure and uncertainty. Their cooperative has adapted measures in order to continue operating. Withdrawals are currently higher than the deposits. Still, loan payment is higher than loan application. Thankfully, technology really helps in operations. In conclusion, liquidity remains stable. As long as members see the coop as active, members continue to trust and participate.
It is important for cooperatives to remain open because people rely on them for income, salaries and aid. Ms. Cristina Naigan from St. Martin of Tours Cooperative presents a counterpoint. Located in Luzon, St. Martin had to follow ECQ measures. It had to close because assessments were made on the situation. For now liquidity is reduced by 20%. There is an expectation of more withdrawals. Members need security. Members need cash. There is an attempt to pivot and shift to online transactions but members preferred to go to branches. Another dilemma was that there were no ‘work from home’ measures. The organization is trying its best to adapt.
To address issues, St. Martin gathered data from their members and staff and proceeded to make reports and measures. Restaurants were hit the most but rice trading is thriving.
Data showed trends on possible scenarios in order to aid members. More training programs are being organized. More efforts are being discussed and developed for aid. Data is crucial in order to succeed in the new normal.
This highlights different situations for different places in the Philippines. There is an agreement between the panel that this crisis is unprecedented and unique. This conclusion then would push leaders towards continuous creation and revision of policies based on multiple possible scenarios. Delinquency is predicted to rise. With that in mind, making sure that members stay and increase is needed. The cooperative needs to inspire and retain trust.
There needs to be a conversation on income alternatives as well. There are opportunities for cooperatives to become suppliers and consumers. Different coops from different provinces are now working together. For example, coops in La Union provide fish. Coops in Mindanao provide rice. These efforts are addressing hunger in their communities and in the Metro.
An audience member brought up the notion that provincial governments and other cooperatives do not cooperate at times with all the efforts mentioned above. This shows that some of these organizations fear bankruptcy and lack trust towards other institutions. If cooperatives do not help each other and communicate, more of them will close. Note that members and employees are most important. Once this is over, they would need job opportunities, security and income.
Different stimulus programs are also in the works. The objective is to remain visible and to inspire trust and loyalty from the customers and members. When ECQ ends, the coop comes back stronger, with more members and funds.
There is a need to revisit the cooperative’s business processes amidst this crisis. Apart from the usual savings and credit facilities, cooperatives can possibly aggregate the produce of MSME members and link them to the marketplace. In this way, coops can help members recuperate from losses and in turn can pay their loan obligations.
Indeed, there is a lot to learn and work to do for our country’s cooperatives.