Eleven banks have joined to form a new alliance called The Global Alliance for Banking on Values in a move to build a positive alternative to the current crisis in the global financial system. According to a press release on the Netherlands based Triodos Bank’s website, this new partnership plans to develop new ways of building organizations better suited to long-term sustainable thinking and also to develop new forms of ownership and economic cooperation. The alliance was launched at an event held in The Netherlands from March 2-4, 2009. The event was also attended by Her Royal Highness Princess Máxima of The Netherlands, a former banker and former member of the United Nations Group on Inclusive Financial Sectors, and Achim Steiner, Executive Director of the United Nations Environment Program. The eleven member alliance was founded by the Bangladesh Rural Advancement Committee (BRAC) Bank based in Bangladesh, ShoreBank Corporation the United States based community development and environment bank and Triodos Bank in The Netherlands. Other member banks of the alliance include Alternative Bank ABS in Switzerland, Banca Popolare Etica in Italy, Banex, Banco del Exito in Nicaragua, the GLS Bank in Germany, Mekur Bank in Denmark, Mibanco, Banco de la Microempresa in Peru, New Resource Bank in the United States and the XacBank in Mongolia.
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MICROCAPITAL STORY: SKS Microfinance in India Plans to Launch Operations in China
SKS Microfinance, the largest microfinance provider in India in terms of assets, is planning to launch operations in China, in a move to expand its reach beyond India. According to a press release on The Economic Times, SKS reckons this would be the ideal time to enter the Chinese market. The export driven Chinese economy has been impacted by the global meltdown and several vocationally-trained rural employees in China have lost jobs. SKS plans to give credit to these unemployed groups in China and help them start their own ventures. In this regard, the release quoted the chief executive officer and managing director of SKS Microfinance, Mr. Suresh Gurumani as saying that SKS was looking to expand in China primarily because it was a ‘large country with a significant population that was poor’. Mr. Gurumani also stated that the expansion was a move to share SKS’ knowledge in the field of microfinance to benefit ‘a larger section of people’. SKS’ foray into China would make it the first overseas expansion for an Indian microfinance institution (MFI).
MICROCAPITAL STORY: Microinsurance Client Base of Allianz Life Indonesia Grows Four-fold in 2008
Microinsurance provider Allianz Life Indonesia has announced that its microinsurance client base grew 417 percent in 2008, from 42 thousand policyholders at the end of 2007 to 183.8 thousand at the end of the year. Its line of microinsurance products, dubbed “Payung Keluarga” (meaning “Family Umbrella”), generated a modest premium income of USD 82.5 thousand for the year, up 350 percent from USD 19.6 thousand in 2007. The significance is not the profit, but rather the increase in business volume. Payung Keluarga offers a range of life insurance products from basic credit life protection, which prevents microcredit borrowers from leaving debt to their family, to products that offer additional payouts to family upon the death of a breadwinner. Allianz Life Indonesia settled 76 microinsurance claims in 2008.
MICROCAPITAL STORY: The National Federation of Microcredit Associations (FNAM) in Morocco to form Committee to set up more Microcredit Associations; Calls for more Diversification of Microcredit Services
The National Federation of Microloan Assocation (FNAM), a Moroccan non-governmental organization (NGO), has called for the need to revise the existing microcredit strategy in Morocco in an effort to make microcredits accessible to more people, according to a press release on Magharebia, the news and information website about the Maghreb region in Africa. In this regard, the FNAM plans to set up a committee that would focus on establishing microcredit associations in those Moroccan regions that are greatest hit by poverty. The term Maghreb is generally applied to the countries of Morocco, Algeria and Tunisia. The Magharebia web site is sponsored by the United States Africa Command, the military command responsible for supporting and enhancing US efforts to promote stability, co-operation and prosperity in the region.
MICROCAPITAL STORY: The MasterCard Foundation in association with the Aga Khan Foundation Canada (AKFC) and CARE Canada to Invest USD 9m to Expand Savings Initiatives in Tajikistan and Rwanda
The MasterCard Foundation, an independent, private foundation based in Toronto, Canada has announced two new programs to expand savings initiatives in the countries of Tajikistan and Rwanda. According to a press release on PR Newswire, a total investment of USD 9 million will be made towards these programs aimed at strengthening and creating innovations within the Village Savings and Loan Association (VSLA) model. The program in Tajikistan will be in association with the non-profit, Aga Khan Foundation Canada (AKFC) whereas CARE Canada (an operational member of the private, international humanitarian organization CARE International) will be involved with the MasterCard Foundation for the Rwandan initiative. The electronic news and information portal, PR Newswire is headquartered in New York, USA and is a subsidiary of the London based global business media company United Business Media Plc.
NEWS WIRE: Bahrain launches first poor people’s bank
Source: Gulf News.
MICROCAPITAL PAPER WRAP-UP: From Revolution to Evolution: Charting the Main Features of Microfinance 2.0 by Ronald U. Mendoza and Brandon C. Vick
Written by Ronald U. Mendoza of the Office of Development Studies, United Nations Development Program (UNDP) and Brandon Vick of Frodham University, this paper speculates on the future of microfinance and elaborates on the role to be played by private innovations and public policies in this regard. The 43 page document was published by Fordham University, Department of Economics in its Fordham Economics Discussion Paper Series in February, 2008 and the full text is available here.
PRESS RELEASE: UNCDF/UNDP Project Launches a Mobile Bank to Support Access to Financial Services in Rural Areas
MICROFINANCE EVENT: Booth School of Business & Harris School of Public Policy Studies at the University of Chicago / Kellogg School of Management at Northwestern University Sponsor Chicago Microfinance Conference (CMFC) in Chicago, USA, May 8th, 2009
Chicago Microfinance Conference
Navigating the Markets: Microfinance in the New Economy
May 8th, 2009
The Harper Center, the University of Chicago Booth School of Business, 5807 South Woodlawn Avenue, Chicago, IL 60637 USA
PRESS RELEASE: UNCDF/UNDP Project Launches a Mobile Bank to Support Access to Financial Services in Rural Areas
MICROCAPITAL STORY: International Symposium on Microfinance as a Tool for Peacebuilding Discusses Rebuilding the Social and Economic Fabric in Post-Conflict Areas of Colombia through Microcredit
The International Symposium on Microfinance as a Tool for Peacebuilding discussed how microcredit could be used to rebuild the economy and promote growth in post-conflict areas of Colombia. According to this press release on the Symbiotics website, the symposium which was held in the city of Cali in Colombia was attended by nearly 2000 participants. Symbiotics is a microfinance information, consulting and services organization based in Switzerland. The symposium was sponsored by the Alvaralice Foundation, a Colombian non-profit established in 2003 and dedicated to promoting peace and economic growth in the country.
MICROCAPITAL STORY: State Bank of Pakistan Launches Three Microfinance Development Funds With Proceeds from the UK Government Financial Inclusion Programme and the Asian Development Bank
The State Bank of Pakistan (SBP) has launched three microfinance initiatives: the Microfinance Credit Guarantee Facility, the Institutional Strengthening Fund, and Improving Access to Finance Services Fund. The initiatives are part of the GBP 50 million, or USD 75 million, Financial Inclusion Programme (FIP), a joint venture between SPB and the UK Department for International Development.
MICROCAPITAL STORY: GTZ Provides Microfinance Training to Participants from the Central Bank of Yemen in Anticipation of New Microfinance Law
The German Development Cooperation (GTZ) Private Sector Development Project (GTZ-PSDP) began providing training workshops on microfinance for participants from the Central Bank of Yemen. The first workshop began on January 24 2008, and is the first in a series of workshops which aims to build the capacity of the Central Bank to better understand microfinancing, according to Ozaina Al-Jundi, an advisor for microfinance at the GTZ-PSDP. The workshops will be held every month in 2009. The trainees from this initial workshop will be responsible for applying a proposed microfinance law which is awaiting approval by the Yemeni Parliament. Yemen is a priority partner of the GTZ where it aims to develop and promote business related services, improve political, legal and institutional frameworks for investments and strengthen central government and private institutions. The proposal of a Microfinance Banking Law was discussed in 2007 by representatives of the Central Bank as a first output of a National Action Plan related to the National Microfinance Policy Statement. The Action Plan was developed through a cooperation between the Ministry of Planning and International Cooperation (MOPIC), the Central Bank, Social Fund for Development and with funding from KfW. More information on this can be found in this MicroCapital Story.
NEWS WIRE: More than 100 Million of World’s Poorest Benefit from Microcredit
Source: Microcredit Summit Campaign.
MICROCAPITAL STORY: Central Bank of Liberia (CBL) Grants Formal Banking License to Liberia’s First Commercial Microfinance Institution, Access Bank Liberia (ABL); ABL Starts Issuing Loans to the Public
Access Bank Liberia (ABL), the first commercial microfinance institution of Liberia, has become operational and started issuing loans to the public, according to an announcement by the International Finance Corporation (IFC), a member of the World Bank group. ABL, which received a preliminary banking license in July 2008, started operations after it was granted a formal banking license by the Central Bank of Liberia (CBL) on January 21, 2009. According to the announcement by IFC, since receiving the preliminary license, ABL had hired and trained loan officers, tailored all its savings and credit products to cater to the demands of the Liberian market and ensured compliance of all its banking systems with the Liberian law. ABL will focus on microfinance lending in Liberia in addition to providing short and medium-term lending to small and medium enterprises (SMEs) in Liberia. So far, no information on the interest rates to be charged is available yet.
MICROCAPITAL STORY: Government of Cape Verde to Create Microcredit Bank; Portuguese Bank Banco Português de Gestão (BPG) to Hold a 10 Percent Stake in the Bank
The Government of Cape Verde will open a microcredit bank in the island republic of Cape Verde in the first half of 2009. This announcement was made by the Finance Minister of Cape Verde, Ms Cristina Duarte in the capital city of Praia. According to a press release found on the Macau based news service macauhub.com, the bank would focus on the needs of poor families and small and medium enterprises in Cape Verde. Micro-enterprises account for nearly 50 percent (p 2) of Cape Verde’s employment, according to the report ‘Understanding the microenterprise sector to design a tailor-made microfinance policy for Cape Verde‘ published by the University of Evora. As per the press release on Macauhub, the new bank would have an initial equity of 300 million Cape Verde Escudos, approximately equivalent to USD 3.4 million. The release also stated that the Portuguese Bank, Banco Português de Gestão would hold a 10 percent stake in the bank, following approval from the Central Bank of Cape Verde, Banco de Cabo Verde.
NEWS WIRE: A Stimulus Package for the World
Source: New York Times.
MICROCAPITAL STORY: Arab Development Summit Commits US$2 billion to Microfinance Through Arab Fund for Economic and Social Development (AFESD)
Arab states have agreed to form a USD 2 billion fund to extend credit and help reduce unemployment in the region. While reports on an inability to make a decision on the situation in Gaza dominate the press discussing the first Arab Economic, Social and Development Summit in Kuwait City, this is one of the only material agreements that has emerged from the Summit. The funds will be managed by the Arab Fund for Economic and Social Development (AFESD) and will include a microfinance programme. Amr Moussa, secretary-general of the Arab League, was quoted as saying that economic issues had to move forward in the face of political differences between the states, while Kuwait’s foreign minister, Mohammed Al Sabah, stated that it had been proved that economic activity was the best way to control poverty. No specific details on how the funds will be used were provided, except that the total amount will be used to support small and medium enterprisers and boost investments in the Arab world, and that a Grameen Bank-model of microfinance will be used.