Nurturing Social Coherence through the Bayanihan Banking Program (BBP) of Pasay City, Philippines

Pasay City is the third smallest political area in the National Capital Region (NCR). It has a population of 408,000 - 41 percent of which are considered poor (based on 2000 National Statistics Office survey) - and a population density of 2,553 persons/per sq. km. It is divided into 201 barangays (villages), one of the biggest in the NCR, 46 percent of which (92 barangays) are classified as depressed. Eighteen percent of Manila's slum dwellers reside in this city.
Pasay City is considered as the transportation hub of the country. The country's main domestic and international airports are located here. The majority of buses have their terminals in this city. All modes of transportation (heavy rail, light rail, buses, jeepneys, etc.) to and from major NCR destinations can be found here. This accessibility of Pasay City also makes it the preferred place for rural migration.
Unemployment and underemployment levels are high. Naturally, when income and savings are low, access to credit is limited. In most cases the only credit available to Pasay's poor residents, for emergency and other purposes, are those provided by informal and small time lenders.
The Bayahinan Banking Program in Pasay City started out as a church-initiated pooled savings scheme following the principle of the Grameen Banking Program, which employed a community's collective effort to establish and manage a micro-finance and banking scheme aimed at providing the urban poor access to cheaper money for livelihood endeavors. Account Officers were designated to set up Financial Centers composed of savers/members. The Centers later forged linkages with cooperatives or established cooperatives with other Centers to provide not just financing/loans but other training and capability building support in pursuing livelihood undertakings.
Its initial success in 1998 prompted the City Government to provide necessary financial and institutional support with the end view of replicating it in other sectors and districts and communities of Pasay. Later it was recognized by the national government and a program for its replication throughout the country was set up. Today, the BBP has been replicated in numerous local communities. Pooled savings have reached millions, and thousands of people/households have benefited. Community organizations have also been established and partnerships among actors in the formal sector (local government units, national government agencies, church), and informal sector (NGOs, POs, Cooperatives, etc.) continually get strengthened. Local and international organizations have also already recognized the BBP as an innovative local governance initiative.
As the BBP gets more and more replicated, lessons learned are highlighted and areas for improvement are defined. With its huge success and tremendous prospects, the BBP continues to inspire local governments and afford local communities a remarkable mechanism for them to be both participants and beneficiaries in realizing equitable access to opportunities.
Lessons learned include: (1) The local government unit need not necessarily be the main actor of local governance; (2) The ideals and credibility of the initiator are key factors in generating support and acceptability; (3) Getting the recipients involved in all stages of the program through formal and informal structures empowers them and creates in them a sense of community; (4) While local governance is essentially about all actors collectively doing their share towards a collective goal, the consistent presence and drive of a "champion" is crucial; and (5) At some point and in a very careful manner, an initiative towards community development initiated by a non-government and/or informal sector, must be recognized and provided support by the formal sector (national or local government) to help sustain and strengthen its initial successes as well as facilitate its replicability.