Posts Tagged ‘credit’
Posted on March 19, 2010 - by James
SBP credit guarantee scheme for SMEs…
KARACHI: SBP governor Salim Raza would launch a credit guarantee scheme for small and rural enterprises under the financial inclusion program at a ceremony on March 19.
He will also announce a refinance scheme for small and medium enterprises in NWFP, FATA and Gilgit-Baltistan to enhance flow of credit to SME and agriculture sectors with greater emphasis on revitalization of business activities in the troubled areas of NWFP, FATA and Gilgit-Baltistan.
Posted on October 20, 2009 - by boris
Kenya: New SME rating tool to ease small firms’ access to credit…
Small and Micro Enterprises (SMEs) have lately become the “heart” of the Kenyan banking sector, surpassing the retail market which in the previous years had been a goldmine for most commercial banks.
During the peak season for the retail market, the rate of lending rose and threshold requirements for lending were lowered. Many of the retail customers took advantage of the lowered thresholds and dropped their loan applications at numerous banks to increase their chances of success.
For the few SMEs that have dared to put in their applications for loan facilities to strengthen their working capital from commercial banks, the underwriting system have became even more tighter.
Instead of the loan underwriting system of MFIs, which are only anchored on the three Cs of lending; character, capacity, and capital, they are subjected by banks to five Cs system of underwriting which includes the three , in addition to condition and collateral.
Source: http://www.businessdailyafrica.com/-/539444/674232/-/item/0/-/1p5422/-/index.html
Posted on October 9, 2009 - by boris
IFC will provide $15 million to Brazil’s Banco Triângulo S.A. to help expand credit for micro and small entrepreneurs…
IFC, a member of the World Bank Group, will provide $15 million to Brazil’s Banco Triângulo S.A. to help expand credit for micro and small entrepreneurs in the underdeveloped areas of Brazil’s north and northeast.
IFC’s local currency financing will have a five-year tenor, unusually long for midsize Brazilian banks under current market conditions. This will be IFC’s second financing to the bank, known as Tribanco, which received a $10 million loan in 2004. Tribanco is part of Grupo Martins, a large wholesaler in Brazil. It was created in 1990 to provide a wide range of financial services for small retailers and is now one of the largest microfinance providers in Brazil.
“We are extremely pleased with IFC’s value added, as it provides a longer tenor than is available normally in Brazil, and further diversifies the bank’s funding sources,” said Tribanco’s Board President Juscelino Martins. “We look forward to building on our long-term partnership with IFC.”
Source: http://www.ifc.org/ifcext/media.nsf/content/SelectedPressRelease?OpenDocument&UNID=80B6A355F60FD1B385257649004FCD6C
Posted on July 1, 2009 - by Gavin
Economic Policy Tilting Toward the Less Rich…
The Korea Times
In an apparent reaction to criticism, the Lee Myung-bak administration has been adopting a series of policies to appease the less well off. But the move has attracted criticism from chaebol and the rich.
Finance-Strategy Minister Yoon Jeung-hyun announced his intention not to cut income and corporate taxes for big business, and then on Tuesday unveiled a 2.1-trillion-package for the poor.
But chaebol lobby group, the Federation of Korean Industries, Tuesday urged the government to adopt a pro-business policy so that companies can create more jobs and increase investment.
The policy U-turn came amid opposition criticism that the Lee administration is a government only for the rich and business groups.
Minister Yoon said it will become easier for the working class to get small loans without collateral, and families with three or more children will be given priority when applying for apartments supplied by the government.
“Difficulties are continuing for the working class as incomes fall, household economies worsen and the job market falters,” the minister said Tuesday. “It will take considerable time until things get easier for the working class, though the economy is showing signs of improvement,” he added. (more…)
Posted on July 1, 2009 - by Gavin
Lending changes threaten poor…
Business Day
The end of interest-rate caps on pay day lenders will leave low-income earners vulnerable to exploitation.
State-based rate caps that stop lenders charging exorbitant interest are likely to disappear once the Federal Government takes over regulation of consumer credit, raising concern about the impact on low-income borrowers who have no choice but to use high-cost “fringe” lenders.
The Federal Government is expected to rely on its “responsible lending” laws, due to take effect from November, rather than maintaining the interest-rate caps that apply in NSW, the ACT, Victoria and Queensland.
However, the co-author of a Griffith University study of interest-rate caps, Therese Wilson, says the Government shouldn’t dismiss them out of hand. And, she says, regardless of which route it takes, it must ensure vulnerable, low-income borrowers have access to safe, affordable, short-term credit by closely monitoring and enforcing its rules.
“The Government has indicated that it’s not keen on interest-rate capping,” says Wilson, who also chairs the Australian Microfinance Network. “There will be a responsible-lending requirement attached to credit contracts and I think it’s relying on that to minimise exploitative lending practices. (more…)
Posted on June 26, 2009 - by Gavin
Home Proposals pave way for banks to reach rural poor…
Business Daily
Finance minister Uhuru Kenyatta on Thursday proposed amendments
to the Banking Act to legalize branchless banking and allow the
Kenya Post office and Savings Bank to trade in the foreign
exchange market.
Should the proposals be enacted, The Post Office Bank long
saddled by laws barring it from carrying out conventional banking
business will now be able to receive deposits on behalf of
commercial banks while trading in the forex market.
In the landmark proposal, minister for finance Uhuru Kenyatta’s
move to allow commercial banks to use non-bank agents such as the
post office is expected to unlock the reach of banking services
across the country.
Posted on June 24, 2009 - by Gavin
Microlender Kiva matches individuals with U.S. entrepreneurs who seek funding…
News Room Jersey
SAN FRANCISCO — Microfinance is a big focus in the international
development world. It’s the process of getting small loans and
financial services to the poor and underserved. And it’s not just
global institutions like the Grameen Bank that make those loans.
There are a number of Web sites that help individual Internet
users fund entrepreneurs from Kenya to Cambodia.
Now, one of the biggest, Kiva.org, is allowing users to make
microloans to small business owners, like Vika Sinipata, in the
United States.
An idea for a business is not enough
In January, the human resources professional fulfilled a longtime
dream. She opened her own business, assisting the elderly. She
got the idea for it after taking care of her own relatives. What
she couldn’t get was a line of credit.
Posted on June 24, 2009 - by Gavin
Microfinance firm gets Sh254m profit…
The Citizen News
CRDB Microfinance Services Company made a pretax profit of Sh254
million last year, an annual report distributed to delegates
during a micro-lending forum organised by the bank showed.
The company provided Sh48.5 billion micro loans. The outstanding
loan portfolio stood at Sh58.8 billion by December 2008, a
statement by CRDB Bank managing director Charles Kimei showed.
The company was established in 2000.
Under the Uwezeshaji Credit Guarantee Scheme, it disbursed Sh22.9
billion to 203 microfinance institutions, surpassing the
Government target of lending Sh22 billion in 2008. The firm
participated in the Mwananchi Empowerment Scheme initiated by the
National Economic Empowerment Council to facilitate lending in
select regions.
The Our priority is to expand our microfinance initiatives to
reach out more districts and provide services to more Tanzanians
who have no access to financial services. To achieve the goal,
the company will continue to open new service centres for MFIs
[microfinance institutions],” he said.
Posted on June 22, 2009 - by Gavin
MFIs in Africa face collapse as financial crisis bites…
Microfinance institutions in Africa have very little chance of
surviving the current financial crisis as loan repayment default
soars. Most of their low-income debtors will be too busy
concentrating on personal survival to think of repaying their
loans. This is despite a show of resilience by the global
microfinance sector in a new survey conducted by CGAP, an
independent policy and research centre dedicated to advancing
financial access for the world’s poor. “There have been few
failures among microfinance institutions since the onset of the
current financial crisis. However, the more than 400 respondents to
the March survey reported significantly tougher market conditions,”
reads the report, released recently. In East Africa, microfinance
institutions have been pivotal in spurring growth and development
for the majority of rural dwellers. They also support a thriving
small and medium scale enterprise sector that today account for
about 30 per cent of the gross domestic product of countries like
Kenya. However, the full impact of the financial crisis is likely
to be felt in the second half of this year. Accordingly, many MFIs
are taking steps to cope, such as taking a more conservative
lending approach and in some cases, even cutting staff. “Many poor
households are struggling with the many consequences of the global
food, financial and employment crises,” said Elizabeth Littlefield,
CGAP’s chief executive. She added, “Their income sources like
revenue from small businesses or from money sent from families
working abroad, have become more erratic. At the same time, many
expenses like food, are still far higher than before. Savings are
thus being withdrawn and loan repayment rates to MFIs are
worsening.” According to the survey, as opposed to their
counterparts in emerging economies, leading MFIs in the West are
well positioned to adjust their operations to weather the financial
storm. Many are investing more in client communications and
tightening credit and collection policies. Source:
http://www.theeastafrican.co.ke/business/-/2560/613414/-/5jyrrxz/-/
Posted on June 22, 2009 - by Gavin
Citibank Arranges Farm Loan For Microfinance Institution In Bangladesh…
Gant Daily
Dhaka, Bangladesh (AHN) – Citibank, N.A. Bangladesh has
arranged to raise $21.74 million (BDT 1.50 billion) term loan for a
microfinance institution, according to BURO Bangladesh. The
necessary facility document related to the financing is expected to
be signed soon, officials said in the capital, Dhaka on Sunday. In
compliance with Bangladesh Bank directives to expand credit in the
agricultural sector, the entire facility arranged by Citibank,
being the lead arranger, is earmarked for the expansion of BURO’s
agricultural loan portfolio. BURO’s Finance Director M. Mosharrof
Hossain said that 100 per cent of the financing raised from banks
will be directed towards the agricultural sector through
non-governmental organization (NGO)-linking system. “We’ll disburse
the loan to the farmers through our 393 branches across the
country,” Mr. Hossain told AHN in the capital, Dhaka, adding that
the loan will be given to agro-based eight sub-sectors like crops,
irrigation equipment, livestock, agricultural products marketing,
fisheries and poverty alleviation. (more…)
Posted on June 22, 2009 - by Gavin
WHO’S WHO IN MICROFINANCE: Catherine Quense, ACCION International’s Interim President and CEO…
Microcapital Catherine Quense, ACCION International’s Chief
Administrative Officer and Chief Deputy, will take over as interim
president and CEO, replacing Maria Otero, who has left to join the
Obama Administration as Under Secretary of Global Affairs in the US
State Department. Ms. Quense will direct ACCION in line with its
2008-2011 strategic plan and the key initiatives launched under Ms.
Otero’s direction, “ACCION’s Model for Social Change” from its 2007
annual report. The four issues the plan addresses are “low income,
poor quality of life, vulnerability and lack of dignified
solutions,” through which the provision of financial services to
low-income households will address. ACCION will broaden and reach
beyond its target audience from informal-sector microentrepreneurs
in urban Latin America for a greater global reach. The new areas
include Inner Mongolia, China and Nigeria. Prior to joining ACCION,
Ms. Quense served as director of operations for a domestic social
service organization, further details of which are not
available. She later joined the national VISTA (Volunteers in
Service to America) volunteer program as special assistant to the
director, and details on her term are not available. Since it was
established in 1965, participants in VISTA work with agencies in
communities across the United States to help further local efforts
in alleviating poverty. Issues addressed through this program
include education, service learning, homelessness, hunger, economic
development, elderly, and youth. She also has a background in the
purchasing and credit insurance divisions of Prudential.
Information on her exact role and duties and time of tenure at
Prudential are not available. Founded in 1875, Prudential is a
global financial services institution with approximately USD 542
billion in assets under its management as of March 31, 2009.Ms.
Quense joined ACCION in 1983 as the assistant to the executive
director where she worked on the formulation and implementation of
a national education program designed to raise awareness about
Latin American development issues. She then served as
ACCION’s chief financial officer and senior vice president from
1985 to 2008. During this time, ACCION’s balance sheet grew from
less than USD 1 million to over USD 250 million. She most recently
served as ACCION’s Chief Administrative Officer and Chief Deputy,
managing human resources, global office operations and information
systems, legal services, and risk and performance management
programs. This position was created to reflect ACCION’s expansion.
At the time, Ms. Otero stated, “ACCION’s ambitious new strategic
plan and expanding operations in West Africa, India and China
demand a larger and deeper executive team, and someone to serve as
the right hand of the organization,” and “Cathy is just that
person.” As Chief Administrative Officer, she was responsible for
business and support services for operations. She also leads
implementation planning and manages organization preparedness for
global expansion for ACCION. Along with these duties, Ms. Quense is
involved in strategic organization planning and development for
ACCION International and ACCION USA. In addition to her roles and
duties at ACCION International, Ms. Quense serves on the board of
directors for ACCION Chicago and of Centro ACCION Microempresarial
in Bogota, Colombia. She is also listed as an individual investor
and donor for ACCION Chicago. She also sits on the board of several
nonprofit organizations, the names of which are not publicly
available. Moreover, Ms. Quense has participated as a Partners of
the Americas Fellow in International Development, funded by the
Kellogg Foundation. Partners of the Americas was established in
1964 as part of the US Agency for International Development. The
organization deals in the areas of civil society and governance,
exchanges and fellowships, gender and equality, youth and children,
and agriculture and environment. The Kellogg Foundation is a
US-based investment and grantmaking organization established in
1930. Ms. Quense holds a Master of Public Administration with a
concentration in International Development from Harvard
University’s John F. Kennedy School of Government, and a Bachelor
of Arts in Latin American studies from Yale University.
Established in 1961, ACCION International is a U.S. non-profit,
which heads a network of 27 microfinance institutions. ACCION
claims that with its partners, they have disbursed more than 28.5
million loans totaling USD 23.4 billion; 97 percent of the loans
have been repaid. According to its 2007 annual report, it has
assets worth almost USD 353 million, 3.1 million active borrowers,
and 700,000 clients with a savings account. Source:
“http://www.microcapital.org/who%E2%80%99s-who-in-microfinance-catherine-quense-accion-international%E2%80%99s-interim-president-and-ceo/”
Posted on June 18, 2009 - by Gavin
CreditRegistry obtains CBN approval-in-principle…
Business Day Online
CR Services plc (CreditRegistry), the pioneer and only fully operational credit bureau in Nigeria, has announced that it has obtained Approval-in-Principle (AIP) from the CBN to provide credit bureau services in Nigeria. Since inception in January 2003, CreditRegistry’s focus has been on bringing great value to Nigerian financial institutions, retailers and consumers through the innovative application of advanced technologies. With over six years experience in the Nigerian market, CreditRegistry has gained deep insight into the peculiarities of lending in Nigeria.
Today, CreditRegistry remains the first and only credit bureau in the world to integrate biometric technologies into a credit bureau system, providing anti-fraud capabilities to its subscribers. The company provides the most secure, cost-effective and innovative credit bureau solutions to help Nigerian creditors expand credit opportunities to borrowers, while simultaneously preventing fraud.
With a database of over 1 million credit records, CreditRegistry subscribers different itself from competition by incorporating credit bureau information into lending processes to manage risk, reduce fraud and increase profits. (more…)
Posted on June 17, 2009 - by Gavin
New payment system benefits microfinance clients & improves efficiency…
Reuters
World Vision Georgia’s microfinance organisation CREDO has launched a new type of payment system for clients in Georgia, enabling them to make loan payments at no charge via Payment Machines called ‘PayBox’, located in shops, streets and villages across the country. Designed to increase convenience and save time for clients, the new system also means significant cost savings for CREDO, as well as increased cash flow and efficiency of its operations.
This newly adapted method of payment is already in use in Georgia with people using these machines to pay mobile phone bills, Internet and utility expenses 24 hours, seven days a week.
It means easier payment, because people are no longer required to travel great distances to make payments and are not confined to bank working hours.
‘PayBox Technology means savings for clients and CREDO. For clients it is time saving with repayment points closer and they can repay at their convenience. For CREDO it means cost savings; repayment data from PayBox will be automatically imported to our loan tracking system’, emphasized Ljiljana Spasojevic, CEO of AzerCredit Azerbaijan and Credo Georgia. (more…)
Posted on June 15, 2009 - by Gavin
Fighting fire with fire…
Sun 2 Surf
AMID the furore over loansharks imprisoning borrowers in apartments to enforce repayment and the subsequent clamour for tough government action against these callous moneylenders, three popular myths need to be debunked.
Myth No 1 – A high proportion of those who borrow from loansharks are gamblers. This statement is unlikely to be true. Gamblers almost always default on their loans. If loansharks lent mainly to gamblers, their non-performing loans (NPL) would be unsustainably high and they would soon go out of business.
That loansharking is a thriving business suggests most borrowers are non-gamblers with a good record of repayment.
Myth No 2 – To curb loansharks, the government should prosecute moneylenders and reduce significantly the number of moneylenders.
Moneylenders who resort to violence should be prosecuted under relevant criminal and civil laws and this should be done quickly and consistently. But jailing loansharks could shrink the number of moneylenders without addressing the fundamental problem of demand. (more…)
Posted on June 12, 2009 - by Gavin
MFBs operators criticise N50bn micro-credit fund as political gimmicks…
Vanguard
Operators in the micro-finance sector have criticized the N50 billion micro-credit fund set up by the Federal government as a political gimmick as only few microfinance banks have been able to access it.
In separate interviews with Vanguard they called on the government and the regulatory authority to facilitate access to the N50 billion micro-finance development fund, adding that states governments should make available the one per cent of their annual budget for on-lending to MFBs to assist them in poverty alleviation, as required in the microfinance policy..
The Managing director of Citigate MFB, Mr. Phillip Okuabor, said the one per cent fund that is supposed to come from the state and local governments is not forth coming, saying when the fund is made available, government decides which micro-finance banks it should be disbursed to.
“The state and local governments are supposed to set aside an amount not less than 1.0 per cent of their annual budget for on-lending through the micro-finance banks. But none of the local governments have done so. At the state level, it has not been integrated and is being done haphazardly. The Federal Government’s N50 billion is not better, because we thought that the money will go through us, but we heard it would go through the state governments, making it a political gimmick. If MFBs are supposed to collect the money and they can’t decide who the money goes to, then there is a problem,” he stated (more…)
Posted on June 11, 2009 - by Gavin
Road map prepared for micro businesses…
The Jakarta Post
The Indonesian Chamber of Commerce and Industry (Kadin) is drawing up measures to empower small and micro businesses, including efforts to address problems of limited access to financing.
The measures would be derived from inputs from relevant stakeholders – small and micro businesses, the banking sector and regulators – and put together under a road map for MSMEs, Kadin deputy chairman for small and medium enterprises and cooperatives Sandiaga S. Uno said Wednesday.
“Most of the country’s more than 40 million micro, small and medium enterprises have little or no access to bank loans. The reasons vary from tight regulations on collateral necessities, to high interest rates,” Sandiaga said after a Kadin technical meeting to discuss the concept of the road map.
The country’s micro, small and medium businesses have proven their resilience amid waves of economic crises.
During the 1997-1998 Asian financial crisis, Indonesia’s small and micro businesses – which account for about 65 percent of the country’s enterprises – stood firm and continued to grow at a time when the government laid out costly bailout programs for large and internationally-recognized companies. (more…)
Posted on June 10, 2009 - by Gavin
Ghana to Host the Applied Microfinance Institute training programme…
Ghana Web
Ghana -based Blackwealth Consulting and MicroSave Consulting based in Kenya will host this year’s Applied Microfinance Institute (AMI) -Africa, in Ghana, at the Golden Tulip Hotel, Kumasi. This will be the second time that the event will be held in Ghana.
Last year’s event was held for the first time in Ghana at the Elmina Beach Resort, Elmina, in the Central Region. About 90 microfinance practitioners, including consultants and academics attended.
Following significant interest in MicroSave tools and approaches in previous years from West Africa, MicroSave is now very active in West Africa with market-led solutions for the microfinance sector. Previously, many West Africans attended MicroSave’s courses at the School of Applied Microfinance in Mombasa, Kenya. (more…)
Posted on June 10, 2009 - by Gavin
MICROCAPITAL STORY: Zurich Bolivia and Microfinance Bank BancoSol To Offer Life Insurance To Bolivian Emigrants…
Microcapital
Zurich Bolivia, a unit of Zurich Financial Services, and the microfinance bank BancoSol of Bolivia have partnered to offer insurance to Bolivian emigrants in Spain. The insurance comes in four different plans. The first plan, requiring a premium of USD 57, covers 10,000 dollars in case of death due to any cause and the return of the body to Bolivia. The second plan, requiring an annual premium of USD 86, offers the same benefits, as well as home expenses for the family for one calendar year. The third plan, requiring a premium of USD 100, covers the return of the body to Bolivia and the cost of education for two children up to USD 300 per year per child. The fourth plan, requiring a premium of USD 129, includes all of the above benefits.
Bolivian emigration to Spain has been growing in recent years. In 2008, 239,942 Bolivians immigrated to Spain. In 2001, the figure was only 6,619. However, Bolivia ranked 6th behind Romania, Morocco, Ecuador, the UK, and Colombia in terms of number of immigrants to Spain. According to the CIA World Factbook, the Bolivian national GDP was estimated at USD 43.08 billion in 2008 with a real growth rate of 5.6 percent. GDP per capita was USD 4,500. Services constituted 51.8 percent of GDP, with agriculture at 11.3 percent and insdustry at 36.9 percent. However, 43 percent of the labor force was employed in services, 40 percent in agriculture, and 17 percent in industry. The unemployment rate was 7.5 percent in urban areas.
In contrast, the GDP of Spain was estimated at USD 1.38 trillion in 2008 with a real growth rate of 1.1 percent. GDP per capita was USD 34,600. Services constituted 67.5 percent of GDP with agriculture at 3.6 percent. 69.5 percent of the labor force was employed in services. In 2008, the unemployment rate was very high, at 13.9 percent. (more…)
Posted on June 9, 2009 - by Gavin
World Bank rural finance scheme to help Indian farmers…
Sakaal Times
WASHINGTON: With a $20 million Bill & Melinda Gates Foundation contribution, the World Bank will establish an Agriculture Finance Support Facility to support the expansion of rural finance in the developing world including India.
In a time of tight credit, the Facility will support grants to bank and non-bank institutions for activities to increase access to financial services, such as savings, credit, payments and insurance, in rural areas in developing countries as profitable business lines, the bank announced on Monday.
“In India, a country with relatively high rural banking outreach, 45 percent of smallholder farmers did not have a savings account, and 69 percent did not have a credit account with formal financial institutions,” it noted announcing the new venture in recognition of the financial crisis hitting the poorest the hardest.
“There is a great need among smallholder farmers, who make up the bulk of the world’s poor, for ways to save and manage their money,” said Carlos Cuevas, Deputy Director of Financial Services for the Poor for the Bill & Melinda Gates Foundation.
Posted on June 4, 2009 - by Gavin
EU unveils micro-credit plan for small businesses…
AFP
BRUSSELS (AFP) — The European Commission unveiled plans Wednesday to free up 100 million euros (142 million dollars) from the EU budget to provide credit to people wanting to set up small businesses.
When supplemented by funds from international financial institutions like the European Investment Bank group, the commission said, around 500 million euros would be available for micro-credits.
The plan could help people struggling to find money because they are too young, have been unemployed or due to the credit crunch sparked by the global financial and economic crisis.
“This new facility will extend the range of targeted financial support to new entrepreneurs and help them to overcome the squeeze on credit,” commission President Jose Manuel Barroso told reporters.
The move would also see such entrepreneurs supported by mentoring, training, coaching and the possibility to increase the capacity of their businesses once they are off the ground, the commission said.
The Party of European Socialists, campaigning ahead of elections to the European parliament starting Thursday, criticised the plan and other commission proposals aimed at cutting unemployment. (more…)
The MiFi Report
-
