low income housing finance codi experience
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Low-income Housing Finance CODI Experience. CODI in brief. Founded in 2000 A public organization: having a government institution status with flexibility in organization management Main objective: strengthening poor community organizations. Current Activities.

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codi in brief
CODIin brief
  • Founded in 2000
  • A public organization: having a government institution status with flexibility in organization management
  • Main objective:strengthening poor community organizations
current activities
Current Activities
  • Citywide slum upgrading ( “Baan Mankong”)
  • Poverty Alleviation (Supporting communities in savings, credits and loans and community development plan, etc.)
  • Community Welfare
  • Assisting in setting up of Community Organization Councils throughout the country
  • Promoting natural resource management and sustainable agriculture
  • Solving land and housing disputes in rural areas
codi strategies
CODI strategies
  • To play supporting role in community development process
  • People, not CODI, are the owners and key actorsof the process
  • To coordinate with govt. agencies, NGOs, other civic groups
  • To promote community-based savings
  • To use finance as a tool for development
slide5
Network

Network

SAVINGS - CREDIT

LAND - HOUSING

WELFARE

CODI

COMMUNITY

ENTERPRISE

ENVIRONMENT

Network

Academics

OTHERS

Community

Development

Committee

Supported

Agencies

Others

NGOs

Local

Authorities

slide6
CODI provides financial support by lending its capital funds to community organizations.
  • At present, CODI credit facilities comprise four types of loans as follows;

- Loans for housing and development

- Loans for community enterprises/income generation

- Loans for holistic development

- Short-term revolving funds

baan mankong housing program citywide slum upgrading
Baan Mankong Housing ProgramCitywide slum upgrading
  • a breakthrough in solving slums on a citywide scale
  • Comprehensive approach in dealing with problems of land tenure, infrastructure, environment, construction and financing
  • Combination of self support, government subsidy and private cooperation
  • Lead to amendments in rules and laws which are obstacles to housing solutions for the poor
bmk demonstrates strong ppp partnership
BMK demonstrates strong PPP partnership
  • P- Poor people/communities as key actors in identifying problems, developing plans to resolve problems and implementing those plans themselves
  • P- Public; government, CODI, local authorities, etc. Government as subsidy provider: CODI as facilitator, provider of long-term housing loan
  • P- Private sector; NGOs, professionals, educational organizations etc. provide technical support
slide10
City-wide upgrading involving many possible city development actors and find various secured housing solutions for all communities in the city

On-site

Upgrading

Community

Row-house

Community

Land-sharing&

reconstruction

Flat

Find various

solutions suitablefor all communities

in city

City-widesurvey /

joint planning,

search forsolutions

together

Detach house

Reblocking &

readjustment

Municipality

Flat

Resettlements่

Other

dev.agencies

Row-housing

Mixed approach

baan mankong procrss
Baan Mankong Procrss
  • City-Wide Planning
    • Organize meetings of stakeholders
    • Establish joint committee to oversee implementation
    • Survey all communities to identify problems and create holistic plan
    • Develop housing, land tenure and policy plan for whole city
slide12
Form savings groups
    • Mobilize local resources, strengthen local groups, and build collective management skills
  • Set up community working team
  • Collect information about land, housing, physical infrastructure, income, employment, problems, and existing development initiatives
slide13
Conceptualize housing and development goals regarding land tenure, upgrading scheme, involvement of local authorities, NGOs, etc.
  • Formulate financing plan
  • Work with architecture and engineer on developing housing designs and infrastructure
  • Submit detailed plan to BMK committee
slide14
Community Survey

all communities in districts and city

Community survey of all households

In the community and all communities in the city carried out by community people

การ

loan process
Loan process
  • Loan approval
    • Screened by local and regional committees before being sent to CODI
    • Approved by BMK sub-committee comprising reps from communities, CODI, NHA,GSB, GHB
    • If loan amount exceeds THB50 mln.(~USD1.7), approved by CODI board of directors
  • Loan disbursement
    • Loans are disbursed in tranches based on progress of project
progress of baan mankong up to march 2011
Progress of Baan Mankong(up to March 2011)
  • Number of project approval 882
  • Number of cities 278
  • Number of communities 1,552
  • Number of families 91,822
  • Govt. subsidy (THB mln. ) 4,706
slide18
Baan Mankong Chantaburi

Before and after

slide20
Providing Flexible Financial Support

for City-wide Upgrading by Communities

  • Upgrading of infrastructure and social
  • facilities

Grant

2) Local management cost

3) Support for exchange visits, capacity

building, seminars, coordinator

Members

FromCODI

Revolving Fund

Interest 4 %

Communities

Loans

Members

Members

Government

Subsidy

Banks

source of financing
Source of Financing

Three components of BMK financing:

  • Local communities’ own savings (10% of project cost)
  • Government subsidy-THB80,000(~USD2,667) per family
  • Housing loan from CODI
government subsidy
Government subsidy
  • Subsidy is given to community not to individual family
  • Allocation of THB80,000 (~USD2,667)
    • Infrastructure development 55%
    • Financial support 30%
    • Project management (incl. 15%

meetings, training, exchange visits, etc.)

codi loan
CODI loan
  • A collective loan to community organization, not to individual household
  • Collective land tenure
  • Loan maturity is 15 years and is payable in 180 equal monthly installments
  • Interest rate is fixed at 4% p.a.
  • Maximum loan amount per household is THB 300,000 (~USD10,000)
  • CODI finances up to 90% of the project cost.
slide24
Loan Security: 1) Land and buildings are mortgaged with CODI

2) Guarantee agreement signed by chairman, committee and all members of the community organization.

re lending to members
Re-lending to members
  • A loan from CODI is on-lent to individual household with a margin of 2-3% added to e interest cost.
  • The margin is set aside for the purpose of loan administration, community welfare and serves as a cushion for loan repayment in case any member fails to meet his or her obligation in any particular month.
slide26
Loan management by community

CODI

Interest 4%

Community organization

  • Subgroup management
  • Subgroup daily savings
  • Loan collection
  • Group guarantee
  • Help members who cannot pay

subgroup

subgroup

subgroup

subgroup

Community Cooperatives

on lends to members

at 6-7 %. Margin for community

development,

management and welfare

bmk loan performance as of mar 2011
BMK Loan Performance (as of Mar.2011)

(Accumulated amt.) THB mn.(USDmn.)

  • Approval 4,464(149)
  • Disbursement 2,700 (90)
  • Repayment 519 (17)
  • Outstanding 2,181 (73)
  • NPLs 2.05%
  • Beneficiaries
    • No. communities 1,119
    • No. households25,866
funding sources
Funding sources
  • Current funding sources for long-term housing finance
    • CODI initial capital fund approx. THB 2,800 mln.
    • Government budget (2009) THB 3,000 mln.
    • CODI-GHB Refinancing scheme THB 500mln.
codi ghb refinancing scheme
CODI-GHB Refinancing scheme
  • Total amount: THB 500 mln.
  • GHB agrees to refinance BMK loans from CODI at the same interest rate and same terms and conditions
  • CODI and GHB agrees on mechanism to compensate GHB for interest rate differentials
project assessment
Project assessment
  • Key success factors
    • Strong community leadership
    • Flexible, affordable financing for the poor
    • People process which suits poor community livelihood
  • Barriers
    • Public land-use policies
    • Certain rules and regulations
    • Coordination among relevant agencies
slide31
Challenges
    • Future funding for the program
    • Scarcity of affordable land
    • Linkage between formal and informal financial markets
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