The Citi Foundation works to promote economic progress and improve the lives of people in low-income communities around the world. One of its key focus areas is financial inclusion. Here, the Citi Foundation supports efforts to develop a more inclusive financial system that provides greater access to financial products, services and capital to low-income communities and individuals.
Access to capital and financial products empowers adults and young people to build financial assets, enables entrepreneurs to grow or launch businesses that create jobs, and helps community-based organizations to strengthen and transform communities. Unique about its efforts is recognition that access to capital and products alone is not enough. Financial capability, the ability to establish financial plans and develop strategies for preserving a strong financial position during times of both economic prosperity and instability, is critical to the economic success of individuals and communities.
In 2006, Citi Foundation made its first investment in ABS-CBN Bayan Foundation, Inc. (ABFI - from which Bayan Academy was spun-off in 2009) for a financial literacy program for its women microfinance clients. The grant sought to empower rural-based low income women, as well as reach out to urban-based working mothers with “Let’s Talk Money”, a lecture series that also produced a book, in cooperation with ABS-CBN Publishing.
Although microfinance improves the poor’s access to economic opportunities, a 2006 study of ABFI’s clients showed that only 1% of its 40,000 clients were able to scale their business from micro to smallsized enterprises. Through experience, ABFI saw mere lending could not sustain the growth of its clients’ enterprises. They had to be taught how to grow their business through education and training in enterprise management, accompanied by coaching and monitoring.
“We believe that access to financial products and services such as savings, payments, and credit that are tailored to the needs of lower income and unbanked people can make a positive impact in their lives, enabling them to participate in the economy.”
—Aneth Ng Lim
Director for Public Affairs and
Citi-Bayan Entrep-Eskwela Program
In response to this, Bayan Academy applied for another grant from the Citi Foundation in 2010, this time for the Citi-Bayan Entrep-Eskwela Program. Essentially, the program would design a Grassroots Entrepreneurship and Management (GEM) course, and launch it to help develop the entrepreneurial competencies of over 100 microentrepreneurs. Training officers of microfinance institutions were also trained to monitor their clients and measure the impact of the training on their enterprises. Mentoring and coaching sessions were made available to intensify learning in actual enterprise situations.
finance clients, wanting to help them increase their incomes, grow their businesses, and as a result, generate jobs for their communities.
Using an enhanced GEM program, CMDC trained another 200 scholars including clients of ABFI and other microfinance institutions as well as past winners of the Citi Microentrepreneurship Awards.
Small Business Advisory and Coaching Services
From training, CMDC expanded to offer Small Business Advisory and Coaching Services (SBACS), a business clinic and advisory center staffed by a pool of experts who provide coaching and mentoring services in marketing, finance, human resources, operations and regulatory requirements. GEM graduates were encouraged to avail of SBACS to continue their learning experience.
CMDC later established a social media platform (www.cmdc.ph) for online mentoring, continued learning and networking for scholars after they complete the course. The page features video lectures, success stories of selected CMDC scholars, a calendar of activities, directory of graduates, and newsletters, among other relevant information.
In 2013, Bayan Academy engaged the Research and Extension for Development Office of the University of the Philippines’ College of Social Work and Community Development to conduct an impact assessment study of the first two years of CMDC. With a grant from Citi Foundation, the study reviewed the CMDC program and held focus group discussions and interviews with over 300 CMDC scholars.
The study showed that the scholars enjoyed positive gains from their participation in GEM, both on the personal level and as entrepreneurs. The GEM modules equipped them with technical knowledge in effective enterprise management and developed the skills and attitudes they needed to operate a business. The scholars also said the SBACS were “informative, interesting and valuable” and said they would “benefit other small entrepreneurs.” In particular, the study said, “their knowledge, skills and attitudes markedly increased before and after SBACS.”
The positive impact of CMDC can be further gleaned from the surveyed graduates’ enterprises:
1. Expansion and diversification of their business from one type to multiple types, from one product line to multiple product lines;
2. Extensive product promotion and marketing, which expanded their networks and partnerships;
3. Established credibility resulting in their continued access to higher and additional loans; and
4. Increase in asset size and net worth and the participants’ upward movement from micro-entrepreneurs to small and medium entrepreneurs.
Premier Microenterprise Learning Center
In the next four years, the project grew in size and scope. CMDC now offers Entrepreneurship and Management training and SBACS to high-potential microfinance clients not only in NCR, but also in Northern Luzon, Southern Luzon and Palawan.
In 2014, CMDC also reached out to loan and training officers of MFIs in Mindanao who later cascaded the entrepreneurship modules to at least 4,000 microfinance borrowers. A year later, nearly 1,000 of these clients showed a 10% increase in income from business growth and expansion.
A welcome validation for CMDC came in 2013 when it was adjudged the winner in the Social Empowerment Category of the Asia Responsible Entrepreneurship Awards (AREA) held in Singapore.
CMDC was recognized for its impact on microfinance clients in improving and scaling-up their businesses.
AREA is one of Asia’s most prestigious recognitions for organizations that champion sustainable and responsible entrepreneurship. The Social Empowerment award honors businesses that promote empowerment of communities or individuals that are socially excluded or economically disadvantaged.