Microfinance : Opportunities

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Microfinance Opportunities Prospects
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Glance An Introduction
Glance
Glance
Problems
Global Trends
Road Ahead
Toward the Vision
3
Glance Current Scenario
Glance
Problems
Global Trends
Road Ahead
Scale of Microfinance
1. MIX 42 million borrowers, 825 organizations.
2. Microcredit Summit 100 million borrowers (including SHG)
3. AFI - 152 million borrowers, 3000 organizations.
4. Average loan size is 350-400.
5. Penetration Bangladesh (10), India (0.1).
Toward the Vision
4
Glance Social Economic development
Glance
Problems
Global Trends
Road Ahead
Toward the Vision
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Problems
Glance
Problems
Global Trends
Road Ahead
Glance
Toward the Vision
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Problem Rift between two camps
Problems
Global Trends
Road Ahead
Toward the Vision
Glance
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Problem Quality Gap
Problems

• For an individual client, Quality Gap is the
  difference between
• the services received and the ideal.
• At global level, Quality Gap represents the sum
  of these
• individual gaps.

Global Trends
Road Ahead
Toward the Vision
Glance
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Problems
Problems
Global Trends
Road Ahead
Toward the Vision
Glance
Financing MFIs
1. Largely depends on donors, Government NGOs.
2. Debt equity financing not available easily.
3. Lack of international financing foreign investment.
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Global Trends
Problems
Global Trends
Road Ahead
Toward the Vision
Glance
Problems
10
Inclusive Financial System
Global Trends
Road Ahead
Toward the Vision
Glance
Problems
Global Trends
11
Propellers of Growth
Road Ahead
Poverty alleviation through financial self
sufficiency
Toward the Vision
Glance
Problems
Global Trends
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Propellers of Growth Commercialization
Road Ahead
Toward the Vision
Glance
Problems
Global Trends
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Propellers of Growth Commercialization
Type of provider Current Status Future role
Traditional MFI Traditional MFI Traditional MFI
NGO Most numerous group, Deep outreach Smaller role overall, Social innovators
Specialized MF banks Strong providers, rapidly growing Major leaders, product innovators
Public Sector Banks Massive deposits, rural outreach Increased efficiency through competition
Commercial entrants Commercial entrants Commercial entrants
Local and regional banks Active as wholesalers, major deposit takers Increased involvement, service innovators
International Banks Limited involvement, see MF as a part of CSR MF as standard product, acquisition of MFIs.
Big box retailers Spreading worldwide Mass provider of services, delivery innovators.
Road Ahead
Toward the Vision
Glance
Problems
Global Trends
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Propellers of Growth Competition
Road Ahead
Toward the Vision
Glance
Problems
Global Trends
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Propellers of Growth Technology
Road Ahead
Toward the Vision
Glance
Problems
Global Trends
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Propellers of Growth Enabling Environment
Road Ahead
Toward the Vision
Glance
Problems
Global Trends
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Financing Foreign Investment
Road Ahead
Toward the Vision
Glance
Problems
Global Trends
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Toward the Vision
Road Ahead

• Product Services
• Deposit payment
• products.
• Personal loan product.
• Business loan product.
• Insurance and others.

• Pathway for poorest
• Smart subsidies.
• Focus on double bottom
• line.
• Linkages with social
• protection program.

Toward the Vision
Glance
Problems
UN millennium declaration calls for microfinance
projects which meet local community priorities
By 2016.
Global Trends
Road Ahead
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