Flaws in Rural Bank’s Loan Portfolio Management Policies Implementation

Abstract

The research focused on detecting the flaws in rural banks' loan portfolio management procedures in the Philippines' city of Tandag. A total of 44 persons were counted using a rigorous enumeration process.A researcher-created questionnaire was utilized in conjunction with the descriptive survey strategy as the major data gathering technique. Unstructured interviews were also conducted to verify the responses of the respondents. The findings of the study show that unacceptable collaterals are accepted, collectors lack training as to the manner how to collect accounts, loans categorization not used as a tool in decision making, documentation are not updated due to lack of time, and loan pricing not based on the current market demand. In order to improve the overall operations of the rural banking industry and strengthen their internal control systems,it is advised that the rural banking industry continue to provide loan portfolio management training and programs to avoid some operational flaws and policy deviation. A solid internal control system ensures that the loan's operating state is enhanced.