XacBank and Horus Noomadic Solutions, a mobile banking platform, has announced the launch of AMAR/mobile banking services for microfinance in Mongolia. AMAR is enabled by Noomadic. According to Noomadic, the launch of AMAR will enable XacBank’s clients to conduct cash-based transaction and payments by using their mobile phones through a network of agents and merchants. AMAR services can be used with all 4 mobile operators in Mongolia (G-Mobile, Mobicom, Skytel and Unitel) [1]. No additional information regarding how the network will function or its scope is provided.
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MICROCAPITAL STORY: Blue Financial Services in South Africa to Continue Microfinance Growth in Africa But Lessens Pace
Blue Financial Services, the South Africa based microfinance institution (MFI) will remain focused on expansion in Africa and will begin operations in more African countries this year, according to a press release on AllAfrica.com. In this regard, the release quotes Blue’s CEO Dave van Niekerk as saying that Blue’s plans in Africa come despite a slowdown in the ‘pace of its expansion due to the global financial crisis.’ [1]. Per information currently available, Blue’s immediate plans also include the setting up of a branch in Ghana over the next 2 months [2]. (AllAfrica.com is a news and information portal owned by AllAfrica Global Media, a multi-media content service provider, systems technology developer and distributor of African news and information worldwide.)
NEWS WIRE: The Philippines: Rural Bankers Association of the Philippines, Microfinance Council of the Philippines and ACCION International Agree to Promote Client Protections
Source: The Philippine Star.
MICROCAPITAL STORY: International Fund for Agricultural Development (IFAD) Grants $23.9m to Afghanistan for Rural Microfinance and Livestock Support
The International Fund for Agricultural Development (IFAD), a United Nations agency, has announced a grant of USD 23.9 million to create the Rural Microfinance and Livestock Support Program in Afghanistan. This is the first IFAD program in Afghanistan and will be implemented in the northern region. The microfinance portion of the program will tailor microfinance services to the rural population, especially farmers who lack access to microcredit. It will be implemented in partnership with the Microfinance Investment Support Facility for Afghanistan (MISFA).The Ministry of Agriculture, Irrigation and Livestock (MAIL) will be the lead agency for the livestock part of the program which will focus on women headed households and pilot various private-public partnership models. It is not clear how the funding will be split between the two sections of this program.
MICROFINANCE EVENT: 8th Africa Microfinance Network (AFMIN) Annual Conference & General Assembly 16 Nov 2009 to 20 November 2009
Event Name: 8th Africa Microfinance Network (AFMIN) Annual Conference & General Assembly
See Our Comprehensive Event Calendar Here: http://microfinanceassociation.ning.com/events
Cost: No details regarding cost have been provided.
Summary of Event: This event will focus on recommending strategies to boost economic growth in Africa with the view to building strong and inclusive rural financing systems that create employment, wealth and increase income of the poor in rural areas.
MICROCAPITAL STORY: Philippines Government and Microfinance Institutions (MFIs) Initiate Loans Totaling $3.3b Since July 2004
In 2004 the Philippines Government and private microfinance institutions (MFIs) agreed to increase microfinance lending across the country. At the 11th anniversary of the Filipino National Anti Poverty Commission (NAPC), data was released indicating that loans totaling PHP 161 billion (USD 3.3 billion) have been made to 5.8 million microfinance clients from July 2004 to April 2009. The NAPC, a government body, estimated that 2.7 million jobs have also been created through this investment. In 2007 PHP 25.9 billion (USD 537 million) in loans were made and this grew to PHP 64.8 billion (USD 1.3 billion) in 2008. From January to April 2009 PHP 9.7 billion (USD 201.1 million) microfinance loans have been created. It was not clear how this data was collected or the methodology behind it.
MICROFINANCE STORY: The Unaddressed Need for Microfinance Oversight and Customer Protection in Haiti
After the 2002 crisis that wiped out USD 200 million in savings in Haiti, the Haitian government passed legislation to address and increase oversight of savings and loans cooperatives. However, as discussed by the Center for Financial Inclusion’s (CFI) Summary of Client Protection in Haiti, there are no regulations that address the microfinance sector. There has been pending legislation in Parliament for the past two years that would increase oversight for the microfinance sector, the details of which are not available. The Association Nationale de Institutions de Microfinance d’Haiti (ANIMH), founded in 2002, was formed by a group of non-cooperative microfinance institutions (MFIs) to deal with the threat of a similar financial crisis in the microfinance sector. It has a loan portfolio from its member institutions of USD 47.4 million as of 2007. According to the CFI, to regulate and increase consumer protection in the microfinance sector in Haiti, legislation should be passed to address the microfinance sector specifically.
MICROCAPITAL STORY: The Importance Of Financial And Other Education For Microfinance Clients – Lessons From Freedom From Hunger And TechnoServe
A recent report by Kate Murphy in the New York Times highlighted the importance of financial and business education alongside the provision of microcredit. The report notes that interest in training programmes targeting microfinance clients has grown in recent years. The reason for this appears to stem from results of studies which suggest that start-up micro-businesses are more likely to survive if the owners have basic operational skills. Mr. Bobbi L. Gray of the non-profit international development organisation, Freedom From Hunger, was quoted as saying that loan recipients are more likely to succeed if they receive business education. Freedom From Hunger was established in 1946 and currently provides financial education in developing countries under its Credit With Education programme.
MICROCAPITAL STORY: Over-Indebtedness And Borrower Delinquency In The Indian State Of Karnataka – A Blogger’s Observations
In a recent entry posted by Mr. Siddharta Chowdri, ACCION International Country Manager for India, on David Roodman’s Microfinance Open Book Blog, it was pointed out that borrower delinquency has become a problem faced by all MFIs in the Indian state of Karnataka. According to the Mr. Chowdri, microfinance clients in the state are borrowing from as many as 6 MFIs and many local money lenders. Many existing MFI’s in the area do not have the systems to track and monitor how much debt their clients are incurring as a result of loans from other MFIs. A good number of clients borrow excessively and exceed their capacity to repay their multiple loans on a timely basis. As a consequence, some of these clients turn to local leaders with complaints about MFIs and their inability to repay their debts. To add to the problem, a number of local leaders have instructed certain MFIs to cease operations and have informed borrowers via the local media and through word of mouth that they are being exploited. There is some suggestion that the actions of some local leaders in this regard may be politically motivated.
MICROCAPITAL STORY: New book entitled “Microfinance for Bankers and Investors, Understanding the Opportunities and Challenges of the Market at the Bottom of the Pyramid” by Elisabeth Rhyne released by McGraw-Hill
Publishing company McGraw-Hill Professional has released “Microfinance for Bankers and Investors” by Elisabeth Ryne, managing director of the Center for Financial Inclusion at ACCION International. The book explores the challenges of profitably delivering credit, savings, insurance, and remittance services tailored to serve the so-called bottom of the pyramid (BOP), the four billion people in the world who live on less than USD 3,000 per year. The book offers sixteen in-depth case studies, on ventures by companies such as Citibank, Visa, and Sequoia Capital, exploring successful solutions in product design, last-mile delivery to remote villages and urban slums, and technological innovations that reduce costs and provide new means of payment and remittance to populations previously tied to a cash economy.
MICROCAPITAL STORY: CGAP (Consultative Group to Assist the Poor) and the GSM Association Release Mobile Money Market Sizing Study which Estimates Mobile Financial Services will Reach $5b in 2012
CGAP (Consultative Group to Assist the Poor) and the GSM Association (GSMA) will publish the results of a study estimating the size of the mobile financial market at the Mobile Money Summit in late June 2009. It will be announced that the CGAP-GSMA Mobile Money Market Sizing Study found that the market for mobile financial services could increase to USD 5 billion by 2012.
MICROCAPITAL STORY: Global Partnerships Microfinance Fund 2008 Invests $1.75m in South American MFIs FODEMI, Fundacion D-MIRO and Prisma
The Global Partnerships Microfinance Fund 2008 (GP MFF 2008), a member of the Global Partnerships family of funds, reported three investments in April 2009 to the CGAP Microfinance Dealbook, the monthly report on microfinance market transactions. Equadorian microfinance institutions (MFIs) FODEMI and Fundacion D-MIRO each received USD 500,000 in debt while Peruvian MFI Asociacion Benefica PRISMA received USD 750,000 in debt. MicroCapital previously reported on the launch of the GP MFF 2008 in November 2008.
MICROCAPITAL STORY: Co-Operative Bank and Deutsche Bank to Launch a USD 50 Million Microfinance Fund to Directly Target Credit Unions and Co-operatives
Co-Operative Bank and Deutsche Bank (DB) have recently announced the launch of a USD 50 million microfinance fund to target credit unions and co-operatives directly. The “Global Co-operative Development Fund” (GCDF) is expected to launch this month and will be open to investors in the fourth quarter 2009. The fund aims to provide capital to the poorest communities with a geographical target of Central Europe, Asia, and Latin and Central America. The GCDF will be managed by Deutsche Bank and sub-managed by Oikocredit. The Co-operative Bank will be principal sponsor for the GCDF. No additional information regarding how the fund will function is provided.
MICROCAPITAL PAPER-WRAP UP:M-Bureaus: M-Banking´s Next Killer Application?, By Alice Liu and Michael Mithika
“M-Bureaus: M-Banking´s Next Killer Application?” By Alice Liu and Michael Mithika, Published by USAID, April 2009, Available At: http://collab2.cgap.org//gm/document-1.9.34524/17.pdf
In this paper, the authors explore the possibility of using mobile phone payment transaction history to determine credit information for customers at the bottom of the pyramid. Kenya is used as the case study due to its successful mobile-payment (m-payment) system. The authors had worked on the assumption that most clients who make m-payments do not have access to banking services, but this assumption was proven to be false. In fact, a study by the Financial Sector Deepening Kenya (FSD Kenya), an independent trust, found that 70 percent of those who make m-payments use multiple banking services. However, this leaves 30 percent who do not use bank services and whose credit history may be determined through m-payments. Kenya´s M-PESA m-payment system, offered by the mobile phone company Safaricom, was launched in 2007 and registered 2 million customers within one year of operation. Currently, 6 million of the 39 million Kenyan population uses M-PESA. By February 2009, the cumulative value of money transfers made through M-PESA was USD 1.5 billion. Zain Kenya also launched its Zap m-payment platform in February 2009, leaving Kenyans with the choice of two m-payment platforms.
MICROCAPITAL STORY: PT Danamon Optimistic About Microfinance Growth in Second Quarter 2009
PT Bank Danamon, the fifth largest bank in Indonesia by assets, expects loan growth may exceed 10 percent in the second quarter after key economic indicators painted a better-than-expected picture for 2009. According to Danamon President Director Sebastian Paredes, the bank originally expected growth to be lower than 10 percent in 2009 and the first half of the year to be very difficult. “We now feel the second half will be better because interest rates will continue to decrease. First-quarter gross domestic product was also not as low as we expected and our microfinance growth was better than predicted.” Paredes added that beyond 2010 the bank believed loan growth would be as fast it was in the past five years and that loan growth would likely center around microfinance, consumer lending, and small- and medium-sized enterprises
MICROCAPITAL STORY: International Finance Corporation Helps ACDI/VOCA’s CredAgro in Azerbaijan Improve Corporate Governance
The International Finance Corporation (IFC), a member of the World Bank Group, announced on its website that Azerbaijani microfinance institution CredAgro, will join the IFC’s Azerbaijani Corporate Governance Project. As part of the program IFC will advise and train directors, managers, and key shareholders of the institution. IFC will also help revise corporate documents, improve financial reporting and information disclosure, internal control, and internal audit functions.
MICROCAPITAL STORY: 85 Percent of Microfinance Institutions (MFIs) and 61 Percent of Microfinance Investors Say MFIs Should Offer More than Financial Services According to Microfinance Insights Survey
A new survey of 150 microfinance institutions and investors conducted by Microfinance Insights, an international print magazine published by Intellecap, shows that 85 percent of microfinance institutions (MFIs) and 61 Percent of microfinance investors say MFIs should offer more than financial services. Of the MFIs polled, 79 percent offer “products and services that are consciously seeking to create social impact beyond simple financial inclusion,” including 63 percent that offer community development, 60 percent that seek inclusion of minorities, and 53 percent that offer better employment and labor conditions. Over 83 percent of the MFIs polled said their primary goal was poverty alleviation and 78 percent stated their main objective was women’s empowerment. Complete survey results can be found in the May/Jun 2009 issue of Microfinance Insights which can be purchased at www.microfinanceinsights.com/magazine_index.asp.
MICROCAPITAL STORY: ACCION International’s CEO Maria Otero To Be United States Under Secretary of Democracy and Global Affairs
The White House has nominated the president and CEO of ACCION International, Ms. Maria Otero, to assume the position of Under Secretary of Democracy and Global Affairs in the US Department of State. Although the Senate Foreign Relations Committee has yet to approve the nomination, Ms. Otero has indicated that she will accept the position should her nomination be successful. Ms. Otero has been profiled in MicroCapital’s Who’s Who in Microfinance series in May 2007. Her position at ACCION International will be filled temporarily by Ms. Catherine Quense, Chief Administrative Officer and Chief Deputy, while a committee searches for Ms. Oteros successor. Ms. Diana Taylor, Vice Chair of the ACCION Board, comments, “Her nomination as Under Secretary comes as no surprise to those of us who know her and her deep commitment to social and economic justice, and we know that she now has an even more effective platform from which to help build better lives for the world’s citizens.” Ms. Otero was born and raised until the age of 12 in La Paz, Bolivia, whereupon she and her family moved to Washington DC. She holds a BA in Literature from the University of Maryland and an MA in International Relations from Johns Hopkins. She has been with ACCION since 1986 and became CEO in 2000. ACCION International is a microfinance organization founded in 1961 and consisting of 27 partner microfinance institutions (MFIs) in 20 countries. The position of Under Secretary of Democracy and Global Affairs was established under Section 161(b) of the Foreign Relations Authorization Act for Fiscal Years 1994 and 1995. In total, there are five Under Secretaries of State in the Department of State, headed by Secretary Hillary Rodham Clinton.