Navigating Financial Tide

A Multi-Case Analysis on Payment Default Management of Davao Region’s Microfinance Institutions

Abstract

The study aimed to investigate the challenges and coping mechanism of the microfinance institutions in Davao Region brought by the proliferation of investment schemes. A multi-case study method was employed with the purposeful sampling used in selecting the four cases, i.e., microfinance institutions operating in the region. Participants include heads of the credit departments and general manager of operations. The in-depth interview protocol was used in gathering data and other relevant information from the participants. Results of content analysis revealed the main themes of risk identification and recognition, members’ behavior, risk reduction, core business focus, organizational culture, organizational commitment, and enterprise resilience. Members herding behavior could intensify loan defaults. Moreover, resiliency relies significantly on strong organization culture and not just relying on strong implementation of credit policy. The cross-case analysis also revealed that all the four cases have similarities in terms of members’ behavior, risk reduction, and core business focus. They differ on risk identification and recognition, organizational culture, organizational commitment, and enterprise resilience where the experiences and performance of the two cases were quite better over the others. The results of study will have implications on how microfinance institutions strategize in addressing challenges of investments schemes on institution’s profitability.