Institutional Background

CARD Mutual Benefit Association, Inc. started as an informal insurance-like activity called Members’ Mutual Fund (MMF). MMF was established by CARD on April 1994 for the primary purpose of loan redemption in case of death of member-borrowers. It served as an in-house insurance arm of CARD providing death benefits for the members and their legal dependents aside from the loan redemption for member-borrowers.

In December 1996, the Pension Plan was implemented providing retirement, medical and disability benefits to members. This product became very popular to its member-clients. Unfortunately, CARD had not adequately assessed the impact of this product on the institution. When an assessment was done, it showed that a member would have to pay premiums for two years just to cover one month of the benefit. Extrapolating from there, management realized that the whole institution was at risk, and that fulfilling its obligation to members would completely diminish CARD’s capital.  Thus, the Pension Plan was stopped only after a couple of years of its implementation. From this incident, CARD’s management learned that an insurance business must be run by insurance professionals. Management also concluded that the insurance business should not be tied to the capital of a microfinance institution (MFI).

Management extricated CARD from this liability and transferred the assets of the fund to the members who then started a separate company with a separate Board. The management of the MMF was officially turned over to the members on September 9, 1999 during a two-day workshop held in San Pablo City and the fund assumed a new name, the CARD Mutual Benefit Association, Inc. or CARD MBA, a separate legal entity, non-stock, non-profit, owned and managed by the members.

Since then, products and services provided for the members are continuously increasing and innovating. From the primary purpose of loan redemption, CARD MBA now gives Basic Life Insurance Program, Golden Life Insurance Program, Credit Life Insurance Program, Retirement Saving Fund, Donated Benefits, Build-Operate-and-Transfer (BOAT) Program, Mass Wedding and Relief Assistance.

As of November 31, 2016, CARD MBA has a total membership of 3,291,991 households. Translating that figure into individuals, the Association is serving 12,090,037 insured individuals per household. The main office of CARD MBA is in San Pablo City and has forty-nine(49) Provincial Offices.

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Source: Innovations-in-Actions: The CARD MBA Experience by Dr. Alexander M. Dimaculangan

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