Before climate change even reached top-priority level on the global agenda, microfinance institutions have started to take local action against natural disasters.
As the 3rd highest risk area in the world, with more than 60% of its land area exposed to multiple hazards and 74% of its population considered vulnerable, the Philippines is one of the countries where early attempts emerged to enhance the readiness of people and institutions to natural disasters.
For local microfinance institutions, helping strengthen their clients’ resilience while maintaining their own operational continuity was a natural move towards a more proactive response to repeated calamities.
Oikocredit chose the Philippines as its pilot area for natural disaster management in 2014, after years of supporting its affected local partners through a solidarity fund. In partnership with Corporate Network for Disaster Response, a training on Disaster Risk reduction and Management (DRRM) was offered to volunteer microfinance institutions in the Philippines.
The pilot project was comprised of 2 capacity building initiatives, the first part aiming at enhancing basic knowledge of DRRM concepts, and the second part consisting in a training-workshop on basic continuity management, to equip partner MFIs with tools they could use to craft their own Business Continuity Plan (BCP).
That dual capacity building pilot was rolled-out to other countries in South-East Asia and led to the creation of a Roadmap for Disaster Resiliency.
Several local MFIs and clients using this roadmap already reported reduced losses, faster assistance, and enhanced business continuity in situations of disaster over the last years, as a result of the proposed risk reduction approach.
Late 2018 this work was made available to all through the joint-publication with Philippine MFI ASKI of A Guidebook on Disaster Risk Reduction and Business Continuity Planning for Microfinance institutions. The guidebook sketches 12 key steps towards DRRM and BCP, synthesized in a 5-phased Roadmap, from understanding risks (1) to disaster contingency (2) and business continuity (3), to testing (4) and reviewing (5).
The more institutions make that and other disaster risk management tools their own, the more data will be available in the future to accurately measure the positive outcome on the lives of exposed microfinance clients.