Tangga Foundation

The Tangga Foundation is an NGO involved in microfinance covering the seven municipalities. It was established as the NGO arm of a university based health program in the area. Its major trust was to provide micro loans to the poor in the area through self-groups. Individual lending was not allowed. Although the organization was a non-profit organization, it should work for its viability and sustainability in the long run so that in the weaning out of grants from foreign sources, it could stand on its own. Hence, it should adopt an efficient management control system and sound lending policies to ensure success in the field of microfinance. It was expected that at the end of 4th year, the cost of operation can already be shouldered out of the loan interest it has earned. The organization was composed of a board and the management staff, the latter was composed of an Executive Director and two field credit officers. One of the officers handled the bookkeeping function of the organization.

The Board of Directors who met quarterly was composed of 5 faculty members from the university and 4 employees from private companies. The ED was a full-time professor himself who also a member of the board. The ED only worked part-time for the foundation. A full-time ED could not be hired at this stage due to financial constraint. The two full-time field credit officers were college graduates in the field of agriculture and did not have ample experience in micro-finance operation.

The mandate of the NGO came from the umbrella organization, the Praning Network Foundation, which provide a tailor made lending policies to the NGO. A major policy is for the TFI to maintain two bank accounts; one for the operation and one foron-lending. The objective was to attain a repayment rate of 95%. From 2005-2008, TFI receive a grant amounting to P700,000 from PFI to service the credit needs of the clients of the University based health program. However, due to mismanagement and unclear vision of the organization, the funds were depleted and did