Republic of the Philippines

Laguna State Polytechnic University

Los Baños Campus
Los Baños, Laguna
COLLEGE OF BUSINESS MANAGEMENT AND ACCOUNTANCY

CASE STUDY NO. 1:

MUTUAL LENDING

Submitted by:

BSA – 2A

Caliwanagan, Hannah Grace M.

Curammeng, Nicolle M.

Dela Rosa, Joemelyn E.

Lapitan, Herlene L.

Mercado, Cherry Ann A.

Submitted to:

Mr. RomnickPascual

September 6, 2019
I. POINT OF VIEW

The members of the group chose Ms. Juliana Sarangaya’s point of view
because she is the primary person that is involve in the case. Ms. Juliana
Sarangaya is an employee of Mutual Lending, a financing firm. She is the one
who is in-charge of looking for possible borrowers for their business.

II. SYNOPSIS

Miss Juliana Sarangaya is from the newly established branch of Mutual

Lending that opened seven months ago. The branch she is working on is still
struggling in acquiring more clients so in order for the branch to survive they need
to have a bigger number of clients. They were given the opportunity to have more
clients through the help of Ms. Sarangaya’s friend who mentioned a possible
prospect. This prospect has a high position in a university which may arrange an
exclusive loan agreement to its employees if the deal will be pushed through.
However, due to the facilitator’s fee that the prospect is requiring Ms. Sarangya is
reconsidering if she will enter onto the deal despite the situation of their branch.

III. STATEMENT OF THE PROBLEM

This study aims to know if Ms. Sarangaya would accept the prospect client’s
condition, or will she just let go of this chance and just look for another possible
client.

Specifically:

What Ms. Sarangaya will do about their current situation and dilemma?
 IV. AREAS FOR CONSIDERATION (SWOT ANALYSIS)

Table No. 1: SWOT Analysis for the business

STRENGTH WEAKNESS OPPORTUNITIES THREATS

 Offers low  There are not  They could have  The firm may not
interest rate. enough clients more borrowers last long.
that will help through the
stabilize that university
business since the employees.
business is newly
established.
 The transaction  The possible  Many prospective  The number of
with the business clients may think clients will go to their clients may
is faster than that they are not them because they not be enough for
others because very reliable are a newly built their business to
they don’t have a because they are business and the operate smoothly.
large number of just a newly clients may think
customers. established that they have
business. sufficient funds.
 The business has a  They may struggle  The business may  They may not
very hard working to stay in the become known in earn more profit
and dedicated lending industry. the industry. with lower
employee. amount of
interest.
 Their business  Unstable business  Possible business  They may
belongs to a very because they just expansion. struggle to stay in
in demand started. the lending
industry industry.
Table No. 2: SWOT Analysis for Ms. Juliana Sarangaya

STRENGTH WEAKNESS OPPORTUNITIES THREATS

 Aggressive in  Her sense of  Getting promoted  Her strong sense
getting more morality may be in a higher of morality might
clients. Has a considered a position in the affect how she
strong sense of weakness since it firm. will deal to the
morality. may affect her business
judgement. operation.
 She is very  She might not be  She will be  She might have a
determined to able to make a exposed to many misunderstanding
make their wise business people and it will or
business grow. decision. help her grow as a miscommunicatio
business person. n with their
clients and
possible
customer.
 She is hard  She will be
working and goal known in the
oriented. lending industry.
 She will be able
to acquire more
knowledge.
V. PROBLEM FLOW DIAGRAM

Mutual Lending Ms. Juliana Sarangaya

Ms. Juliana Sarangaya,

the one who is assigned in
Mutual Lending is a
looking for possible
newly established
clients were able to make
financing firm.
a profitable group of
customers.

Ms. Sarangaya is not

She was able to find an
satisfied with the number
opportunity to increase the
of their clients. She wants
number of their clients
to add more customers to
with the help of her friend.
their business.

Ms. Sarangaya was

She is torn between
hesitant to take the deal
pushing though with the
because of the facilitator's
deal or not.
fee.

What will Ms. Sarangaya

do? Will she accept the What Ms. Sarangaya will
prospect client's do about their current
condition? Or will she situation and dilemma?
just let go of this chance
and just look for another
possible client.

Figure no. 1: The problem flow of the business

This flow chart shows on how the problem in the company occurred.
 VI. ALTERNATIVE SOLUTIONS

1. Continue to develop and use the connection with her existing profitable clients and
encourage them to invite more potential borrowers.
2. Ms. Sarangaya herself can go directly and make an agreement between the university
employee and for mutual lending to avoid the facilitator's fee.
3. She can offer a lower interest charge that will be convenient especially to low income
earners.
4. Ms. Sarangaya and her company will pay the facilitator’s fee and push through with
the deal.

VII. EVALUATION OF ALTERNATIVE SOLUTIONS

Table No. 3: Advantages and disadvantages of first alternative solution

ALTERNATIVE SOLUTION ADVANTAGES DISADVANTAGES
Continue to develop and use the  It is an opportunity  There is no
connection with her existing profitable to Mutual Lending guarantee that they
clients and encourage them to invite more to justify its will be able to raise
potential borrowers. existence by the number of their
encouraging more clients.
borrowers.  The number of their
 They would have customers will not
more loyal clients. increase.
 The firm will be  Their existing client
known and be might not help them
acknowledged. to look for other
possible borrowers.
Table No. 4: Advantages and disadvantages of second alternative solution
ALTERNATIVE SOLUTION
Ms. Sarangaya herself can go
directly and make an agreement
between the university
employee and mutual lending to
avoid the facilitator's fee.
Table No. 5: Advantages and disadvantages of third alternative solution
ALTERNATIVE SOLUTION
She can offer a lower interest
charge that will be convenient
especially to low income
earners.
Ms. Sarangaya and her company 
will pay the facilitator’s fee and
push through with the deal.
ADVANTAGES
 Ms. Sarangaya can avoid
the facilitator’s fee that
needed to the deal.
 She can make a deal
directly to the potential
borrowers.
 She can assess the
possible clients.
ADVANTAGES
 The low income earners
in that university will
become their borrowers.
 They will be able to have
more possible clients.
 The customers will
borrow bigger amount of
money to their business.
There is certainty that
they will have more
clients.
 Ms. Sarangaya will have a
chance to be promoted.
 There is a high possibility
that they will earn more
profit.
DISADVANTAGES
 The university might sue
her and her company.
 She has no strong
connection to the
university.
 It may take time for her
to make an arrangement
with the employees
DISADVANTAGES
 Mutual Lending will not
earn bigger profit.
 It might affect the
operation of their
business.
 They will not be able to
expand their business
because they do not
have more funds or
profits.
 It is unethical because it
is a form of bribery.
 The prospect client
might ask for more
money.
 There is no assurance
that the facilitator will
be able to do his/her part
of the deal.
VIII. DECISION

The members have decided to choose the alternative solution number 1, where
Ms. Sarangaya will decline the offer of the prospect client, and will just use the
connection from her existing clients. This decision will save her dignity and morality
for being a member of financing company.

IX. IMPLEMENTATION

Mutual Lending

Ms. Saranagaya

Prospect Clients

Clients

Profit

Figure no. 2: The Implementation of the Decision

For the best alternative solution that the members chose, Ms. Sarangaya and
the company will do their best to convince and market the best they can offer to their
prospect client. Also, with the help of their existing clients’ trust and encouraging
words to the associates of them will be a great help for them. The prospect clients will
 become their official clients, then, the official clients will gain prospect clients again
for the company. By this process, the company will gain profit.

X. CONTINGENCY PLAN

If ever the best alternative solution that was chosen by the group members go
differently than expected, still the group has its second best alternative solution that
will probably use, for them to solve the issue or problem. The second best alternative
solution chosen by the group members was, Ms. Sarangaya will go directly to the
university employee and mutual lending to form an agreement without having a
grease payment for the facilitator. In line with that, being involved in unethical act can
be prevented.

XI. MANAGEMENT OR BUSINESS LAW MANIFESTED

In formulating a Business, an entrepreneur or the owner must know that a

Business has its own laws that should be abide by the employers and employees
inside the Business. Unethical doings are prohibited. The law about grease payment or
R.A. no. 9485 was manifested, simply because the prospect client offers to have a
facilitator's fee, but Ms. Sarangaya refuse to have this because she knew that having
the said fee was considered as a bribe and it was against the law and accounted as
unethical deed.