Posts Tagged ‘money’

Posted on June 26, 2009 - by Gavin

NEWS WIRE: Kenya to License Nine Deposit-Taking Micro Lenders by December…

Microcapital

Faulu Kenya Ltd. was granted a license by the central bank to
accept deposits, the first microfinance institution in Kenya to
receive such a permit.

As many as nine micro lenders are expected to receive similar
licenses by the end of this year, Central Bank of Kenya Governor
Njuguna Ndung’u told reporters today in the capital, Nairobi.
Previously, the company wasn’t allowed to take money from the
public and was only able to issue loans.

Faulu was among nine companies that have submitted formal
applications to become deposit-taking institutions, Ndung’u said.
The license was granted in terms of the Microfinance Act that
came into effect in May 2008 and is expected to promote a culture
of saving in Kenya, Ndung’u said.

(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

Zimbabwe: Let’s Create Wealth From Below…

All Africa.com

Harare — We are now into the season of selling agricultural produce. What should be a time of reaping the rich rewards of hard work can turn out tragic as, going by the past and current reports, the nouveau riche or suddenly rich communal and small-scale farmers squander the hard-earned money on wine, women and song and return home to face their wives and children virtually empty-handed.

Scores of women have committed suicide over the years after husbands spent all income from a year of toil in the bright lights of the city. A few men, faced with the ignomy and shame of bringing nothing from the tobacco auction floors, have also taken their lives.

Vultures of all sorts have literally camped outside auction floors to reap where they haven’t sown. These itinerant or roving daylight and night-time vampires seem to have a calendar of where easy pickings are to be made seasonally, as if they have a sort of homing or predatory instinct, making them land where money is and fleecing the somewhat unsophisticated farmers of their earnings.

Maybe the writer, being the amateur psychologist that he is, is treading onto dangerous territory, but could it be something to do with hormones? That men have been hunters from the Stone Age? That the way they plunder weaker rivals is the very same way they squander wealth? The more they get, the more they spend? (more…)

Posted on June 2, 2009 - by Gavin

development: The price of micro-finance…

Daily Times

The high intermediation costs for a typical microfinance provider seem justifiable. Microfinance providers can however use other existing infrastructures or technologies to significantly lessen these operational costs

Since the creation of the Grameen Bank in Bangladesh, the use of micro-finance to alleviate poverty has gained recognition and support around the developing world, including South Asia. Besides providing credit, institutions have been developed to provide a range of other services for the poor, such as savings, home loans and even insurance.

However, the fact that micro-finance institutions end up charging much higher interest rates than commercial banks has led to much criticism concerning their alleged rent-seeking tendencies. To be fair, however, the role and compulsions of micro-finance merit a closer look, including their need to charge high interest rates, before concurring with such an unflattering conclusion.

Before focusing specifically on the issue of interest rates, however, let us contextualise the micro-finance industry in Pakistan. The financial sector in Pakistan as a whole has overall grown steadily in the recent past. Yet the sector’s outreach has largely been focused on a niche market in mostly urban areas, where it caters to the medium-high income group and the corporate sector. (more…)

Posted on May 19, 2009 - by Gavin

Society6 Brings Microfinance to the Art World…

PSFK

Looking to democratize the grant process, Society6 has launched a new patronage system based on micropayments.

“When one of our artist friends was invited to show her work at a prestigious art show, but wasn’t able to secure the funds to go, we knew there was a very real problem to solve”, said co-founder, Justin Wills. To do this, “we started to look at the existing support infrastructure for artists and other creative people,” said co-founder Lucas Tirigall-Caste, and “realized that it was particularly bureaucratic, exclusive and wasn’t designed for scale.” So they re-imagined the process as a meritocracy-one where the crowd calls the shots, not a handful of donors or curators.

Through their “open grants system,” individuals and organizations can easily issue money or opportunity (free products and services) grants to artists from around the world. Artists and other creative people apply to these grants, and the community nominates applicants to create the list of finalists. The grant giver chooses one applicant from the finalist list to award the grant. (more…)

Posted on May 8, 2009 - by Gavin

Canton students learn about microfinancing, appear on TV…

Canton

Micro-financing may seem like a complex subject for a group of fourth-graders, but students at the J. F. Kennedy School have embraced it – drawing the attention of ABC News in the process.

The news crew came to the school last Friday to tape a visit from Katie Smith Milway, author of the book “One Hen.” The segment aired on the Friday night news that evening.

The news story featured JFK because it’s the first school to base an entire curriculum on a book that teaches micro-financing.

“It’s been exciting for us and the kids,” said Principal Jennifer Henderson.

The students started reading the book in September, and Milway visited the school for a kick-off to the curriculum. Since then, the students have been using her book as a guide to learn lessons about finance.

“Micro-financing is really just making small loans,” said fourth-grade teacher Elisa Blanchard.

In the book, a young boy in Ghana named Kojo gets a small loan to buy a hen. The hen lays eggs that he sells, and he is eventually able to make enough money to go to school. The boy then uses the money to start a poultry farm, and he is able to loan money to fellow villagers – starting the cycle all over again.

(more…)

Posted on May 7, 2009 - by Gavin

‘Portfolios of the Poor’ offers rare look at the financial lives of the world’s poor…

Eurek Alert

BILLIONS of people around the world live on less than $2 per day—what many in the developed world easily spend on a cup of coffee. As global leaders work to stabilize the financial systems of the world’s largest economies, they also have an unparalleled opportunity to include poor households in meaningful reform that expands access to those who need it most.

It may seem nearly impossible to survive on so little, but that perception derives from assumptions about the lives of the world’s poor—assumptions that are often unfounded, but shape and restrict how the world addresses the challenges of living in poverty. In a new book published by Princeton University Press, Portfolios of the Poor: How the World’s Poor Live on $2 a Day, Jonathan Morduch, public policy and economics professor at New York University’s Robert F. Wagner Graduate School of Public Service and director of the Financial Access Initiative, and researchers Daryl Collins, Stuart Rutherford and Orlanda Ruthven, provide the first in-depth examination of how the world’s poorest households patch together their financial existences—and finds that they do so with surprising sophistication and complexity. Portfolios of the Poor offers new thinking about how poor households manage their financial lives and describes fresh ideas for reducing poverty by creating and expanding banking tools and services. (more…)

Posted on May 4, 2009 - by Gavin

Lend your mite…

The Hindu Business

Paromita Pain

How many times have you thought of sharing but didn’t know how to give?

The Internet shows you the way. Helping out are sites such as Kiva – Global (http://www.kiva.org/).

You could think of Kiva – Global as a social networking site. Only, this seeks to connect people who are interested in making donations as small as $25 to make a difference.

In a bid to redefine concepts of microfinance, the site lets you browse through various profiles of entrepreneurs and select a person you might want to lend to.

You will be kept informed about the status of the loan, repayment issues and how much progress the project has made through the Internet.

Entrepreneurs from the developing world can register themselves on the site and have donors browse their profiles. (more…)

Posted on April 29, 2009 - by Gavin

Rivers’ microfinance agency sues for understanding…

Vanguard Online

CALABAR—Contrary to perceived delay in the process of disbursing loans to likely beneficiaries of its scheme, the Rivers State Microfinance Agency (RIMA) has sued for understanding to enable the agency effectively perfect plans that would benefit the entire state.

Speaking to newsmen shortly after receiving Vice President Goodluck  Jonathan, on a visit to the Rivers State pavilion at the 1st South -South Economic Summit in Calabar, Managing Director of the Agency, Sir Victor Halliday, pointed out that without proper scrutiny the desired result will not be achieved.

“The issue is not disbursement, but productive utilization and recovery. The money is intact; however, there are technicalities in this business which is made more complex because of the seeming belief in some quarters that government money is no man’s money”, he stressed.

“The microfinance loan depends on the ability of the beneficiary to pay back as well as time for repayment”, the RIMA boss explained, adding that the maximum amount for now  was N500,000 while the minimum is N1.00. (more…)

Posted on April 20, 2009 - by Gavin

Inter-bank market for MFBs: how effective?…

Business Day

The idea of an inter- bank market for microfinance banks is no doubt an interesting one. For starters, such a platform will provide an opportunity for increased mobility of funds among microfinance banking operators, thereby reducing the cost of funding and improving the net interest margin by providing these micro-credit banks with a solid funding base to address short and medium-term requirements. But as laudable as the initiative may be, it is not without challenges as regards effectiveness, considering that the microfinance institutions are spread haphazardly all over the country. This, surely, is unlike the money market association for commercial banks, which has about 24 branches with headquarters in Lagos.

However, microfinance operators see the idea of such an association as a welcome development, since they feel it will boost liquidity and enhance poverty eradication. According to Kashim Olanrewaju, managing director, Afribank Microfinance Limited, an inter-bank market will surely boost the liquidity of the practitioners and ultimately enhance the poverty alleviation programme as well as the overall MFB objectives by making credit available to the end-users.

Moreover, he feels the market will inject sanity and good corporate governance into the system, both of which will form part of the rating modalities for any participating MFBs. (more…)

Posted on April 8, 2009 - by Gavin

Remittances: Money on the move…

Banking Technology

The outlook for remittances is as uncertain as any other part of the financial services sector, but the provision of mobile services is a key growth area.

Officially recorded remittance flows to developing countries are estimated by the World Bank to reach $283 billion for 2008, growth of 6.7% on the previous year. However a slowdown, first seen in the third quarter of last year, could dent the seemingly inexorable rise in remittances.

“In 2009, remittances are expected to fall by 0.9% (or at the worst case, no more than 6%),” says the World Bank in its report, Outlook for Remittance Flows 2008-2010, published in November 2008. “Migration flows from developing countries may slow as a result of the global growth slowdown, but the stock of international migrants from developing countries is unlikely to decrease. Remittance flows from the GCC [Gulf Cooperation Council] countries are likely to fall more than those from the US and Europe, affecting recipient countries in the Middle East and North Africa and South Asia.”

The outlook for remittances, says the World Bank, “remains as uncertain as the outlook for global growth. In the past, remittances have been noted to be stable, or even counter-cyclical, during an economic downturn in the recipient economy, and resilient in the face of a slowdown in the source country. This time, however, the crisis has affected all countries, creating additional uncertainties.” (more…)

Posted on February 16, 2009 - by Gavin

Does nobody want to take money from the poor?…

Source: http://www.ft.com/cms/s/2/4304f838-f7dd-11dd-a284-000077b07658.html

(more…)