Loan Product FeaturesUsing 7 Bank Examples

Comparison of Product Features

Client Eligibility Criteria

No. of years in operation

Licenses Residency Age

Bank 1 At least 1 yr Resident of either of 3 specific towns for the last 3 years

25 – 60

Bank 2 Last 2 years Resident of town where branch is located for the last 3 years

21 – 60

Bank 3 At least 1 year Resident of the same barangay for at least 3 years

21 – 60

Bank 4 At least 1 year Resident of the same barangay for at least 3 years

21 – 65

Bank 5 At least 2 years LGU and DTI

Resident of the branch area for at least 3 years

18 – 60 and in good health

Bank 6 At least 1 year Preferably with LGU and DTI licenses

Resident of the same barangay for at least 3 years

21 – 65 and in good health

Bank 7 At least 2 years LGU license Resident of the same barangay for at least 1 year and must own house and lot

18 -60 and in good health

Client Eligibility Criteria

ID Business Location Co-Maker

Bank 1 Has some form of ID Within the geographic coverage of MFU

Must be willing to get 2 Co-makers

Bank 2 Has some form of ID Within the geographic coverage of MFU

Must be willing to get 2 Co-makers

Bank 3 Has some form of ID (SSS, GSIS, Driver’s License, Voter’s ID, Business Permit

Within priority areas of MFU Must be willing to get 2 Co-makers

Bank 4 Has some form of ID (SSS, GSIS, Driver’s License, Voter’s ID, Business Permit

Within priority areas of MFU Must be willing to get 2 Co-makers

Bank 5 Has some form of ID Within the geographic coverage of MFU

Must be willing to get 2 Co-makers

Bank 6 Has some form of ID Within the geographic coverage of MFU

Must be willing to get 2 Co-makers

Bank 7 Has some form of ID Within the geographic coverage of MFU

Must be willing to get 2 Co-makers

Client Eligibility Criteria

Others Loans Cash Flow

Bank 1 Must have no outstanding loan and past due record

Prioritize those with daily/weekly sales

Bank 2 Must have no outstanding loan and past due record

Business must generate daily/weekly sales

Bank 3 Those with outstanding loans may qualify if they don’t have past due record

Must pass CI and Cash Flow analysis

Bank 4 Those with outstanding loans may qualify if they don’t have past due record

Must pass CI and Cash Flow analysis

Bank 5 Those with outstanding loan with 5-6 operators must finish paying their loans before they can qualify to borrow from MFU

Business must generate daily/weekly sales

Bank 6 Preferably without loans from other sources, formal or informal

Business must generate daily/weekly sales

Bank 7 Those with outstanding loans may qualify if their loans are current.

Business must generate daily/weekly sales

Loan Size

Minimum Maximum

Bank 1 Php 3,000.00 Php 25,000.00

Bank 2 Php 3,000.00 Php 60,000.00

Bank 3 Php 2,000.00 Php 50,000.00

Bank 4 Php 3,000.00 Php 100,000.00

Bank 5 Php 3,000.00 Php 50,000.00

Bank 6 Php 3,000.00 Php 75,000.00

Bank 7 Php 3,000.00 Php 100,000.00

Interest and Other Charges

Interest Service Charge Others

Bank 1 3% fixed per month, add-on

3% Processing Fee = P50; Notarial = P50; Insurance

Bank 2 3% per month flat

2.5% of loan amount Notarial fee = P100; Insurance = 0.3 -0.7% of loan, depending on loan term; GRT=5% of interest payable

Bank 3 2.5% per month flat,

add-on

3%, deducted upfront Insurance = 0.4 – 1.3% of loan, depending on loan term

Bank 4 3.5% per month flat,

add-on

5%, deducted upfront Insurance; Notarial fee = P100; P25 Miscellaneous (e.g cost of forms used)

Bank 5 2.5% per month flat

3% of loan proceeds for 3 mos.; 5% for 6-

month loan, deducted upfront

Insurance = P13/P1000 loan;Notarial fee = P100

Bank 6 2% per month, add-on

2% of loan amount for 2-3 months; 4% for 4-

6 months

Notarial Fee

Bank 7 2.5% per month, add-on

0.83% per month, add-on

Insurance; pre-deducted

Penalties for late payment

Penalties

Bank 1 P20/day missed

Bank 2 P20/ day missed, or P100/week overdue

Bank 3 6% of delayed installment/day, for daily amortizations; 6% of delayed installment/week, for weekly amortizations

Bank 4 P5/day, for daily amortizations

P5/week, for weekly amortizations

Bank 5 P500/missed payment + 5% of the late amortization, if 3 days past due

Bank 6 5% of loan amortization

Bank 7 100% of the amortization amount of every missed payment

Savings Contribution / Contractual Savings

Savings

Bank 1 5% of principal upon loan release 10% of each loan amortization; contractual Clients not allowed to withdraw from the savings account until loan is fully paid

Bank 2 5% of loan amount upon release 10% of each loan amortization; contractual

Bank 3 Initial deposit of P100 At least 10% of each loan amortization; contractual Clients not allowed to withdraw from the savings account until loan is fully paid

Bank 4 Initial deposit of P100 At least 10% of each loan amortization; contractual Clients not allowed to withdraw from the savings account until loan is fully paid

Bank 5 10% of loan amount, add-on

Bank 6 10% of loan amount, add-on

Bank 7 5% of loan amount, add-on

Loan Term

Term

Bank 1 2 – 6 months

Bank 2 1 – 12 months

Bank 3 1 – 6 months

Bank 4 2 – 6 months

Bank 5 2 – 6 months

Bank 6 2 – 6 months

Bank 7 1 – 6 months

Payment Frequency

Term

Bank 1 Daily / Weekly

Bank 2 Daily / Weekly

Bank 3 Daily / Weekly

Bank 4 Daily / Weekly

Bank 5 Daily / Weekly

Bank 6 Weekly

Bank 7 Daily / Weekly

Guarantee / Security

Term

Bank 1

Spouse/relative as co-borrower Two Co-Makers Deed of Assignment of deposit account/Authority to debit Chattel Mortgage (for loans above P15,000.00) Insurance

Bank 2

Spouse/relative as co-borrower Two Co-Makers Chattel Mortgage Pledge of deposits Insurance coverage

Bank 3

For loans below P25,000.00: Spouse’s signature as co-applicant Two Co-Makers Deed of Assignment of Deposit Account Security Agreement (in the vernacular)

For loans over P25,000.00: Spouse’s signature as co-applicant Chattel Mortgage Deed of Assignment on deposit account

Guarantee / Security

Term

Bank 4 For loans below P20,000 Spouse’s signature as co-applicant Two co-makers Deed of assignment of deposit account Security agreement (in the vernacular)

 

For loans over P20,000 but less than P50,000 Spouse’s signature as co-applicant Chattel mortgage Deed of assignment of deposit account

 

For loans greater than P50,000 Spouse’s signature as co-applicant REM Deed of assignment of deposit account

Guarantee / Security

Term

Bank 5 For P3,000 to P5,000 loans Spouse’s signature as co-borrower Must have one co-maker Insurance coverage

 

For loans greater than P5,000 but less than P40,000 Spouse’s signature as co-borrower Must have one co-maker Insurance coverage Security agreement or chattel mortgage on at least one of the following: serialized assets, equipment, vehicle, inventory Deed of assignment of deposit account

 For loans P40,000 up to P50,000: Hard collateral

Guarantee / Security

Term

Bank 6 Must have a spouse/relative as co-borrowerTwo co-makersInsurance coverageSecurity AgreementDeed of assignment of savingsChattel mortgage, on a case-to-case basis, as determined by top management

Guarantee / Security

Term

Bank 7 For loans below P5,000Spouse/relative as co-borrowerTwo co-makersSecurity agreementInsurance

 For loans over P5,000 but less than P50,000

Spouse/relative as co-borrowerTwo co-makersSecurity AgreementInsurance

 For loans over P50,000

Spouse/relative as co-borrowerTwo co-makersInsuranceHard collateral

 For loans P40,000 up to P50,000: Hard collateral

Client Incentives

Bank 1 Clients with perfect repayment can avail themselves of bigger repeat loans, based on adjusted repayment capacity rate (ARCR) and cash flow, with fast loan release of one day

Bank 2 Clients with perfect repayment can avail themselves of bigger repeat loans, based on ARCR and cash flow, with fast loan release of one day.

Bank 3 Speedy access to subsequent loans; Larger subsequent loans

Bank 4 Speedy access to subsequent loans; Larger subsequent loans

Bank 5 Based on ARCR and cash flow, a client may get bigger repeat loans and/or longer maturity period, with fast loan release of within 1-3 days. Clients shall be informed that they cannot qualify for a repeat loan if more than 10% of their payments on their current loan are not on time.

Bank 6 Clients with perfect repayment can avail themselves of bigger repeat loans, based on ARCR and cash flow.

Bank 7 Clients with perfect repayment can avail themselves of bigger repeat loans, based on ARCR and cash flow, with fast loan release of one day.

Client Orientation

Loan Approval Process

Bank 1 Loan application must pass the MF Credit Committee. The Credit Committee meets at least once a week.

Bank 2 Loan application must pass MF Credit Committee. The Credit Committee meets at least once a week.

Bank 3

Loan application must pass the MF Credit Committee. However, the Credit Committee composed of the branch manager and the MFU staff, is responsible merely for evaluating loan applications for recommendation to the Credit Management Director who has the sole authority to approve or deny loan applications up to P150,000. Credit Committee meets twice a week.

Loan Approval Process

Bank 4

Loan application must pass the mini Credit Committee. The Credit Committee, composed of the bank’s VP and Head of Operations, a Board member, and the MFU staff, meets once a week to evaluate applications.

Bank 5 Loans are approved by the Credit Committee at the branch level.

Bank 6 Loan applications must pass mini Credit Committee. The Credit Committee meets weekly.

Bank 7 Loan application must pass the mini Credit Committee. The Credit Committee meets weekly