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To keep tabs on what Danny’s summer, check out his blog: www.dannyinthephilippines.blogspot.com.
Hello everyone!
This will be my last update from Manila. I will be wrapping up my internship here at Seed Finance shortly, and then will be doing a bit of travelling in the region before heading back to Canada for two weeks prior to starting classes again in the fall. Thanks for following my adventures on the far side of the world, and I’ve really enjoyed hearing from those who have offered comments along the way.
Microfinance - Mobile Banking
 A significant new development in the provision of financial services to the lower income segment is broadly referred to as mobile banking. Here in the Philippines, this consists of two major initiatives that I’ve been researching: money transfers via cell phones, and bringing ATMs to the rural areas. Filipinos are some of the most active users of remittance services in the world due to the vast number of people working abroad and also the distribution of the local population across the many islands of the Philippines. To transfer money to family members who live in the rural areas or to students studying in the cities using conventional methods is quite expensive here, since businesses such as Western Union charge a commission fee of 7%-15%. Through a partnership that Seed Finance has with the main telecommunications operator in the country, members of the Seed Finance network can now send remittances electronically via text messaging for as little as 2 cents plus a commission of about 1%. The “mobile money” can then be exchanged for cash by the recipient family member at a “money in-money out” center. The result has been substantial savings and increased convenience for the microfinance users of this technology.
Secondly, a partnership between Seed Finance and an independent ATM deployer in the Philippines has been working to bring ATM machines to more remote communities. The primary market consists of pensioners and government employees, such as teachers and policemen, all of whom are paid via direct deposits to their bank accounts. Prior to the placement of an ATM in their community, these rural residents would have to travel from 45 minutes to 5 hours via bus or jeepney to the nearest bank branch to retrieve their salary or pension. When an ATM is placed in their community, they can save up to $5 (which goes a surprisingly long way here!) and a significant amount of time by using their local ATM. Innovations such as these are proving that they have the potential to be profitable, as well as allowing the companies involved to practice positive CSR techniques for the fellow countrymen and women in hard to reach areas.
Travel - Ifugao Rice Terraces
A few weekends ago I made a trip to the northern part of the country to see the world heritage site of the Ifugao Rice Terraces. Dubbed by the locals as the “Eighth Wonder of the World”, these man-made structures were built thousands of years ago as a way to grow rice on the slopes of the mountains. Each terrace is about 15 feet high and 8 feet wide, and I can only imagine that it would have taken an enormous amount of work to construct and maintain.
The journey to Ifugao was perhaps one of the longest land travel trips of my life. We rode an overnight bus from Manila for 11 hours, and then hired a local “tricycle” to take us past the highway along the dirt trail, for what we thought would be the rest of the way. However, after being squished in the tricycle for an hour, we were told by our driver that he could not transport us any further because the recent rains had washed out the road and that we would need to take a hike to reach the terraces. Initially, I was quite happy about this, having spent the previous 12 hours in a vehicle. We politely asked for directions on how to get there, and our driver pointed us in the direction of what seemed to be the highest mountain in sight. He recommended that we hire a guide so that we didn’t get lost. Quite conveniently, an old man, who appeared to be about 65, walked by and offered us his services. I was initially somewhat cautious about this, and felt that due to his age he would probably slow us down more than anything, but given the lack of competing options I agreed.
After an 8 km uphill walk at a mind-boggling pace set by a local Filipino who was at least 3 times my age, we arrived at the rice terraces. Perhaps it was because of the arduous journey to get there, but the view was perhaps the most unique sight I have seen this summer, and I was thoroughly impressed.
Weather - Typhoon!
While the Philippines does not have anything close to a Canadian winter, I would have to disagree with the experts who say that it does not have a “harsh climate”. The remarkable heat and humidity has given way to the rainy season, and with the rainy season comes typhoons. After joking with my co-workers for the past month that I wanted to experience one while I was in the country, my wish was granted. Typhoon Conson struck the city in a big way last Tuesday night, and it was indeed quite an experience. Winds as strong as 120 km/h came through the area and the rain seemed to be quite relentless. The combination of the two knocked out the power for 3/4 of the nation and claimed the lives of 72 people. Apparently the 3rd floor hostel that I’m living in was just the right size, and was too high to be flooded while too short to be damaged by the wind. Additionally, the bugs in the building must have realized that this was the safest floor to be on as I found a cockroach in my shower the next morning! The locals seemed much less concerned about the weather than I was, and said typhoons hit the country on average once every two weeks. While it certainly was interesting to hear and see the winds and the rains last week, I’ve now crossed it off my bucket list and am hoping to be out of the country before the next one comes along…
Food - The Last Supper – Fear Factor Style
 Yesterday I said my goodbyes to the friends I have made near the hostel where I live in Metro Manila. As a send-off gift, they decided to order me some of the Filipino delicacies that they knew I wouldn’t forget. Overlooking any concerns I might have had about getting sick immediately before embarking on a month of travelling, I agreed to go along with them. They warned me that I would want to soak everything they ordered in vinegar before consuming it for two reasons: to sterilize it and to make it tastier. That probably should have raised a red flag or two… After 5 minutes of watching it all cook on a home-made BBQ, I was treated to the following: pig intestines, chicken intestines, pigs ear and betamax (which was essentially cubes of chicken blood)! After trying all four dishes, I am happy to report that I lived to tell the tale, and the only damage I’ve suffered is a very sore throat from consuming about half a liter of vinegar to choke it all down.
Thanks again to everyone for following my updates this summer. Living in the developing world and working in microfinance has been both a rewarding and, at times, challenging experience; but I’ve learned a great deal about an interesting and important poverty alleviation tool in a different part of the planet in addition to exploring some fascinating places. Please feel free to contact me with any questions you might have about life in the Philippines or the microfinance sector.
Take care,
-Danny
Hello Everyone!
It has been a busy few weeks here in the Philippines since my last update. I’ve spent most of my time in the field interviewing partner microfinance institutions as well as the end-borrowers. Several of the towns I have been travelling to have rotating “brown outs” where the electricity is only available to the residents for a certain number of hours per day, so internet access is occasionally hard to come by. However, working away from the office has allowed me to learn more than I otherwise would by strictly staying in the city.
Microenterprises
One of the common questions I have been asked by friends and family is what types of businesses microfinance loans go towards. Having visited a number of them, and used the services of a few as well, the short answer is that it varies greatly by community. In the more rural areas, small farmers who plant crops such as coconuts and rice are common, while in the semi-urban and urban municipalities, vendors who sell food or small items are the most frequent borrowers. There have also been quite a few random, but interesting, microenterprises I have come across including a lady who travelled throughout the village performing manicures for her customers, and a gentleman in a mountainous region who purchased a “habal-habal”, which is a mortorbike used to transport customers to areas that cars and tricycles cannot get to because of the lack of suitable roads.
A Tale of Two Resorts…
Two weeks ago I travelled to a town called Merida on the island of Leyte to witness the launching of a mobile money project in the area. The residents of the town were quite accommodating, and insisted that they cover my expenses to stay at the nearby “Merida Beach Resort” since there were no hotels nearby. Initially I thought this was more extravagant than I needed, and only at their persistence accepted the offer. Upon my arrival at the “resort”, I found out there were only 3 rooms there. I was checked into room #1 by the owner and his son, neither of whom seemed to speak English. After unpacking my bag, I turned on the light to the bathroom and noticed that there were about 2000 ants marching from a drain near the bottom, up the wall, and disappearing somewhere in the roof over my bed. While I have grown somewhat accustomed to having a few bugs around, I didn’t think I would be able to sleep that night in the middle of an ant colony, so I went to request bug spray from the owner. He shook his head and smirked that I was even thinking that was a possibility, but indicated that I could have room #2. I decided to give it a shot; regardless of what was there I was sure it couldn’t be worse than the ants. However, after opening the door and flicking on the lights, two green lizards ran across the floor and under my bed. Having already been on edge from the ants, I jumped about two feet in the air, and turned around to see that the son had joined his fathering in having a hearty laugh at my expense. About at that point I decided that living with 2 lizards was safer than sleeping with 2000 ants, and that I wasn’t willing to take a chance on room #3. Needless to say, it was not the best sleep I had ever had.
The next week was a long weekend, as the country was celebrating their Independence Day. I took advantage of the extra day off of work, and travelled a couple hours South of Manila to another resort, but had learned my lesson and actually did some research on it before I went. It was a great weekend, and my first experience swimming and snorkeling near a coral reef. I spent a total of 9 hours in the water that weekend, and saw many interesting fish, including a jelly fish, sea urchin, and a few of Nemo’s clown fish relatives, and was also pretty amazed by the soft coral. Perhaps most surprisingly, the rates were less expensive than it would be to stay at a Howard Johnson hotel for a hockey tournament or cattle show back home in Canada.
Corporate Perks???
The last story will be a short one. While looking through the financial statements of Seed Finance’s partner MFIs , I came across an item that I had not seen before in any of the annual reports that I’ve read on companies and non-profits in Canada and the US. Listed under the note titled “Staff Compensation” was a description of the allowances and benefits they were allotted. After reading the usual “retirement benefits, sick pay leave, housing allowance etc.” came one that I had not, and likely will not, ever see again: Rice Allowance. I had to ask the rest of the Seed Finance team if that was a joke or not, but apparently it’s quite common here in the Philippines. So for all of you who are, are soon to enter, the corporate working world, don’t forget to ask if you can get your Filipino Rice Allowance before signing the next contract…
Happy Canada Day! I’ll send another update soon.
-Danny
An Opportunity of a Lifetime in the Philippines
Some of you may remember last year when it was announced that Danny Hertz, a 4-H alumni, former Ambassador, 2008 Provincial Judging Champion and 2008 USA National 4-H Conference award trip winner, was awarded a prestigious Loran scholarship.
 Some of you may also remember last summer when Danny earned an internship position at the Canadian Embassy, a dream job that took him from the home of his post-secondary studies, Kingston, ON, to Washington D.C.
And now, welcome to summer 2010, where Danny has opted to try the Philippines on for size for the next three months. We will be posting the link to his travel blog as soon as it’s up and running, and we look forward to being able to bring you updates regarding his experience and travels via this blog. An article will also run in the fall 2010 issue of the
4-H Magazine, so stayed tuned!
This piece posted below is from Danny, outlining the reason for his volunteer work, and what he will be working on.
To keep tabs on what Danny’s summer, be sure to check out his blog: www.dannyinthephilippines.blogspot.com.
Danny Hertz – Philippines 2010: Update #1
Hello Everyone,
This summer, I’ve accepted a volunteer internship in the Philippines, working at a microfinance institution. Needless to say, I think that it’s going to be an interesting summer! Here is a bit of information, to catch you up on the “what” and the “why” of this experience. If you have any questions or comments about microfinance, Southeast Asia, or the Philippines, please don’t hesitate to contact me at dhertz_14@hotmail.com and I would be happy to speak with you about my experiences over here.
Background Information
Q: Why on earth are you working in the Philippines this summer? Wouldn’t it be much easier to stay at home in Canada?
A: As part of my Loran scholarship I am required to do three summer experiences: public policy, international personal and community development, and enterprise. Last summer was my public policy summer where I worked for the Canadian Embassy in Washington, this will be my international personal and community development summer, and next year will be my enterprise internship. After looking into a few different possibilities, I decided to pursue a position in the microfinance field this summer as it’s an area of international development work that I strongly support and felt my skills would be able to help out with. Additionally, I wanted to spend some time in Southeast Asia and had heard positive feedback about the Philippines. I had the good fortune to receive an offer from Seed Finance a couple months ago, and haven’t looked back since.
Q: What is microfinance?
A: Microfinance is the provision of basic financial services (lending, savings, insurance, money transfer) to the lower-income segments of society that the traditional, formal finance sector does not serve. Microfinance is being used as a tool to combat poverty in the developing world, and in my opinion, has the potential to make a greater, longer term impact than other types of development funding. Microcredit, the loans aspect of microfinance, has largely been a private sector initiative that has been proven that it can be self-sustaining and does not necessarily rely on continual external sources of grants or subsidies.
Q: How is microfinance used to help those who are less fortunate?
A: By providing the financial services that we tend to take for granted, microfinance allows for individuals and families to increase their financial security, income and wealth levels. Loans are provided for entrepreneurs to start or grow their own small businesses to provide for their families, savings products allow for families to put aside funds for sudden demands for cash that everyone face (sickness, weddings, education expenses etc.), and microinsurance helps reduce the vulnerability to external shocks that would otherwise threaten the family’s financial security.
That’s all for now, but I’ll be sending an update shortly!
- Danny
Danny Hertz – Philippines 2010: Update #2
Hi All,
My most recent ramblings on what I’ve been up to!
Seed Finance
I left the Calgary Airport on a clear and cool, -2° C morning, and stepped out of the plane into the 38°C heat of a Manila afternoon some 40 hours. After arriving at the office, I was briefed on Seed Finance (SF), the organization that I am interning with, and given a full schedule of my itinerary for the following three weeks. To my surprise, they had already organized a busy three weeks of activities for me, including meetings with some of Seed Finance’s loan providers, business partners, and clients. I will be in 6 different cities in 6 different provinces on 5 different islands by the end of the month, which is great because it allows me to meet a lot of people in the sector and see some different areas of the country. As a wholesale financial institution, SF provides loans worth a total of $9 million and training services to 70 retail microfinance institutions who then provide financial products to over 1.2 million people throughout the Philippines.
Living in the Philippines
 At least for the first month, I will be staying at a hostel in a residential (read: non-touristy) area of Metro Manila. The place is only a few steps down the chain from first-year residences at Queen’s, but is working well for me so far. The most important thing is that it has an air conditioner, as I would probably not be able to sleep without one (night time temperatures only dip down to 25°C). I’ve only seen two cockroaches in the building and a handful of other bugs since checking in, which is actually not too bad. Eating regular meals here has been an ongoing adjustment for me, and I try to eat a mix of Filipino food and “normal” fast food from good ol’ McDonalds and Pizza Hut. It’s customary to eat rice at least two times a day here (and often for breakfast), as it’s the replacement for bread products that we would normally have back home. People here eat a lot of fish, which has also been a pretty big change for me having grown up on a cattle ranch. Last week I had one stretch of 6 meals in a row with only fish as my meat product, and I don’t think I would have had more than 6 meals in my entire life that had fish in them up until that point. Most people speak a basic level of English hear, but their native tongue is Tagalog. I’m trying to pick up a few key phrases while I’m here, but it’s proving to be quite difficult.
Jeepneys and “Balut”
 The two most memorable completely new experiences that I’ve had so far have been riding jeepneys and eating the local delicacy in Southeast Asia, balut. Jeepneys are the main form of public transportation for local Filipinos, and are essentially an off-road looking, low-cost version of a van crossed with a jeep. So far I’ve been the only North American that I’ve seen ride one, and judging by the looks I get from fellow passengers, I very well could be the first white person ever do so. During rush hours, it’s common to squeeze 14 or 16 people into the vehicle that should normally hold about 8 comfortably. No seatbelts, no padded seats, and I pretty much go on a hope and a prayer that it’s travelling in the right direction. However, I’ve found that people here are always willing to point you in the right direction when you’re completely lost and in a different part of the city than you’ve ever seen before (which has happened to me on numerous occasions). I’ve attached a couple pictures of the beast for you all to see what a jeepney is like.
Last week, I travelled to Ormoc City to meet with some partner financial institutions. After our meetings one night, we went out to find some local “street food”, and in particular “balut”. Apparently it’s quite common entertainment for Filipinos to try and get Europeans and North Americans to try to eat balut, but few manage to convince them to do so. I did not have the luxury of being told exactly what it was prior to opening up the egg, and it took me a while to find out. After drinking the juice (which I had to put a ton of salt on to be able to choke down), I then decided to eat the yolk because it looked like the next safest thing in comparison to the dark mass at the bottom of the shell. Upon closer inspection, I then realized that there were feathers said dark mass. It was at that point that I was informed that balut is actually a fertilized duck egg that is 17 days old. They can hatch as young as 25 days, so you can imagine how developed they were at that point (feathers, beak and feet all intact). Thankfully I didn’t eat that part of the egg, but I was the only one in the group who took a pass on it.
That’s all for today, I’ll try to send out another update in a few weeks. Hope you’re all doing well!
-Danny
To keep tabs on what Danny’s summer, be sure to check out his blog: www.dannyinthephilippines.blogspot.com.
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