...Overview of Financial system of Bangladesh The financial system of Bangladesh is comprised of three broad fragmented sectors: Formal Sector, Semi-Formal Sector, Informal Sector. The sectors have been categorized in accordance with their degree of regulation. The formal sector includes all regulated institutions like Banks, Non-Bank Financial Institutions (FIs), Insurance Companies, Capital Market Intermediaries like Brokerage Houses, Merchant Banks etc.; Micro Finance Institutions (MFIs). The semi formal sector includes those institutions which are regulated otherwise but do not fall under the jurisdiction of Central Bank, Insurance Authority, Securities and Exchange Commission or any other enacted financial regulator. This sector is mainly represented by Specialized Financial Institutions like House Building Finance Corporation (HBFC), Palli Karma Sahayak Foundation (PKSF), Samabay Bank, Grameen Bank etc., Non Governmental Organizations (NGOsand discrete government programs. The informal sector includes private intermediaries which are completely unregulated. [pic] The financial market in Bangladesh is mainly of following types: Money Market: The primary money market is comprised of banks, FIs and primary dealers as intermediaries and savings & lending instruments, treasury bills as instruments. There are currently 15 primary dealers (12 banks and 3 FIs) in Bangladesh. The only active secondary market is overnight call money market which is participated...
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...Overview of Financial system of Bangladesh The financial system of Bangladesh is comprised of three broad fragmented sectors: 1. Formal Sector, 2. Semi-Formal Sector, 3. Informal Sector.The sectors have been categorized in accordance with their degree of regulation. The formal sector includes all regulated institutions like Banks, Non-Bank Financial Institutions (FIs), Insurance Companies, Capital Market Intermediaries like Brokerage Houses, Merchant Banks etc.; Micro Finance Institutions (MFIs). The semi formal sector includes those institutions which are regulated otherwise but do not fall under the jurisdiction of Central Bank, Insurance Authority, Securities and Exchange Commission or any other enacted financial regulator. This sector is mainly represented by Specialized Financial Institutions like House Building Finance Corporation (HBFC), Palli Karma Sahayak Foundation (PKSF), Samabay Bank, Grameen Bank etc., Non Governmental Organizations (NGOs and discrete government programs. The informal sector includes private intermediaries which are completely unregulated. | | | Related links About financial markets | Regulators | Bank & FIs | Capital market | Insurance | Micro Finance Institutions (MFIs) | Recent developments | Key financial indicators | Print this page | | | | | Financial System of Bangladesh | Formal Sector | Semi Formal Sector | Informal Sector | Financial Market | Money Market ...
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...A PROJECT ON MICRO FINANCE MANAGEMENT AND ITS ANALYSIS IN INDIA BANKING MANAGEMENT CONTENTS PAGE NO. 1. ABSTRACT 3 2. OBJECTIVE 3 3. METHODOLOGY 3 4. INTRODUCTION 4 5. EMERGENCE OF MICRO FINANCE 5 6. CLIENTS OF MICRO FINANCE 6 7. MICRO FINANCE NEED IN INDIA 6 8. MICRO FINANCING REGULATIONS IN INDIA 7 9. ACTIVITIES IN MICRO FINANCE 8 10. LEGAL REGULATIONS 9 11. GOVERNMENT ‘S ROLE IN SUPPORTING MICRO FINANCE 12 12. MICRO FINANCE SUPPORTING WOMEN 13 13. MICRO FINANCE MODELS 14 14. SUCCESS OF MICRO FINANCE IN INDIA ...
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...agriculture (according to the World Bank reports), micro-finance can play a vital role in providing financial services to the poor and low income individuals. Microfinance is the form of a broad range of financial services such as deposits, loans, payment services, money transfers, insurance, savings, micro-credit etc. to the poor and low income individuals. The importance of micro-finance in the developing economies like India cannot be undermined, where a large size of population is living under poverty and large number of people does not have an access to formal banking facilities. The taskforce on Supportive Policy and...
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...development initiatives. INTRODUCTION Microfinance is defined as, “a type of banking service that is provided to unemployed or low-income individuals or groups who would otherwise have no other means of gaining financial services”(refer to bibliography). In other words it is provision of financial services such as savings, credit and insurance to individuals that fall below the poverty line. Microfinance therefore is also stated as creation of social value for these individuals by elevating their circumstances and helping them to envision the livelihood opportunities. Through the provision of capital for micro enterprise, savings for risk mitigation and insurance the purpose or the goal for the sustainability of rural developers is achieved. The microfinance programme through SHG (Self Help...
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...developed a successful and sustainable business model which has been able to overcome challenges traditionally faced by the financial services sector in servicing the low income population by catering to its specific needs, capacities and leveraging preexisting community support networks. As of March 2009, microfinance institutions (“MFIs”) in India reached over 22 million borrowers and had a portfolio outstanding in excess of $2.3 billion. The microfinance business model in India typically generates a Return on Equity (“ROE”) of between 20% and 30%, driven by financing from commercial banks, strong operating efficiency and high portfolio quality.1 Despite achieving rapid growth with a CAGR of 86% in loan portfolio outstanding and 96% in borrowers over the last five years, the microfinance sector still faces a large unmet demand which means that it still has great potential for continued growth. The microfinance sector is maturing and beginning to diversify its product and service base to address other unmet financial and non-financial needs of the low income population either directly or by acting as a conduit for third-party providers – savings, insurance, remittance and low cost education and healthcare services being some of the key examples. Given this growth and maturity dynamic, the Indian microfinance sector is increasingly becoming a viable investment sector with commercial investors joining social investors who have been nurturing the industry thus far. Equity valuations in...
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...| | Contents LIST OF TABLES 2 INTRODUCTION 2 WHY MICROFINANCE? 3 MICRO FINANCE SERVICE PROVIDERS 4 THE EMERGENCE OF PRIVATE MICROFINANCE INDUSTRY 4 MICRO FINANCE IS ALL AROUND US 5 LITRETURE REVIEW 6 SUMMARY OF Y. H. MALEGAM COMMITTEE REPORT 2011 14 Why Malegam Committee Report was Set up? 15 Key recommendation 16 PROFIT AND NON PROFIT ORGANIZATION 21 Differences between for-profit MFI’s and non-profit MFI’s 23 For Profit MFI 23 Non Profit MFI 24 METHODOLOGY 25 CAPITAL STRUCTURE AND ASSET ALLOCATION 25 DEPTH AND BREADTH OF OUTREACH 27 EFFICIENCY 28 PRODUCTIVITY 29 QUALITY OF THE PORTFOLIO 31 ANALYSIS OF NUMBER OF ACTIVE BORROWERS 33 PROFITABILITY AND SUSTAINABILITY 35 CONCLUSION 36 REFERENCES 36 LIST OF TABLES Table 1 Table of Comparision 12 Table 2 Comparison of Debt Equity Ratio 25 Table 3 Debt Equity Ratio 26 Table 4 Comparison of Depth and Breadth of MFIs for the year 2012 with 2010 27 Table 5 Comparison of Depth and Breadth of MFIs for the year 2011 with 2010 27 Table 6 Operating Expense / Loan Portfolio 28 Table 7 Industry Standard for Operating Expense / Loan Portfolio 29 Table 8 Productivity of MFI’s for the year 2010 29 Table 9 Productivity of MFI’s for the year 2011 30 Table 10 Industry standards for year 2010 30 Table 11 Quality of portfolio for the year 2010 31 Table 12 Quality of Portfolio for year 2011 31 Table 13 Quality of Portfolio for year 2012 32 Table...
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...others. In Kenya on the other hand Micro Finance Institutions (MFIs) include Faulu Kenya, Kenya Women Finance Trust (KWFT), KUSCCO (Kenya Union of Savings and Credit Cooperatives), Economical Locus Fund (ECLOF), Small and Medium Enterprise Programme (SMEP), Kenya Small Traders and Entrepreneurs Society (KSTES), the Kenya Post Savings Bank (KPSOB) and Vintage Management (Jitegemee Trust). Microfinance is the provision of financial services to low income households and micro and Small Enterprises (MSEs). The sector provides an enormous support to the economic activities of the poor thus contributing to poverty alleviation. Micro finance is usually understood to entail the provision of financial services to micro entrepreneurs and small businesses, which lack access to banking and related services due to the high transaction costs associated with serving these clients’ categories. The two main mechanisms for the delivery of financial services to such clients are relationship based banking for individual entrepreneurs and small businesses; and group based models, where several entrepreneurs come together to apply for loans and other services as a group. For some people , Micro finance is a movement whose object is “a world in which as many poor and near-poor households as possible have permanent access to appropriate range of high quality financial services; including not just credit but also savings, insurance, and fund transfers”1. The sector promotes...
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...China Microfinance Industry Assessment Report By He Guangwen, Du Xiaoshan, Bai Chengyu, and Li Zhanwu China Association of Microfinance Feb. 17, 2009 This report has been jointly accomplished by Prof. He Guangwen, Director of Rural Finance and Investment Research Center of China Agricultural University (CAU), Prof. Du Xiaoshan, Deputy Director of Rural Development Institute of China Academy of Social Sciences (CASS) and Chairman of Board of Directors of China Association of Microfinance (CAM), Mr. Bai Chengyu, Director of Division III of China International Centre for Economic and Technical Exchange (CICETE) and Secretary General of CAM with the support of the Network Strengthening Program (NSP) of CAM. Mr. Li Zhanwu, Division Director of Ministry of Human Resource and Social Security, Dr. Li Lili of Henan University of Finance and Economics, Dr. Zhang Zhengping, Associate Professor of Beijing Technology and Business University, Dr. Yang Jing of Beijing Material College, and Li Yaning, Yang Lu and Wang Dan from CAU have also joined the research work. Besides, this report has obtained the guidance and assistance from Ms. Wang Dan, Managing Deputy Secretary General of CAM, and the experts of SEEP. Mrs. Wang Li, President of Social Responsibility Department of Citi China has provided strong administrative and professional support. Hereby, special thanks should be given to the above fellows. For more information, pls contact Prof. He Guangwen at heguangwen@sina.com 1 ...
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...Success of Microfinance in Bangladesh: Its Determinants, Impacts & Challenges Chapter- One Introduction 1.1 Introduction: In recent years, microcredit, in its wider dimension known as microfinance, has become a much favored intervention for poverty alleviation in the developing countries and least development countries. There is scarcely a poor country and development oriented donor agency (multilateral, bilateral and private) not involved in the promotion (in one form or other) of a microfinance program. Microfinance programs claim many achievements as its impact and an outside observer cannot but wonder at the range of diversity of the benefits claimed. Although Bangladesh has huge potential for development, it is, for various socio-economic reasons, among the poorest countries in the world. About half of the country's population lives below the poverty line with 80% in the rural areas. The burden of poverty falls disproportionately on women, who constitute half of the total population. Logically, therefore, poverty alleviation and creation of rural employment are top priorities in the development agenda of the government of Bangladesh (GOB) which has adopted a broad based approach to poverty alleviation, emphasizing macroeconomic stability, economic liberalization, and support for a number of government agencies and non-government organizations (NGOs). Substantial progress has been made in implementing the microcredit program (MCP), and the scope for its efficient...
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...Micro-Finance in India Micro-Finance in India Submitted by: S.GINMUANSANG NGAIHTE This project work is submitted as fulfillment of the requirement of B.COM(hons) Part III of Delhi University Submitted to: Prof. Shuchi Pahuja PGDAV college, Delhi University. Submitted by: S.GINMUANSANG NGAIHTE This project work is submitted as fulfillment of the requirement of B.COM(hons) Part III of Delhi University Submitted to: Prof. Shuchi Pahuja PGDAV college, Delhi University. Shri Ram College of Commerce B.Com(h) Part-III Roll no.13/10 #9650430713 [Type the fax number] [Pick the date] Shri Ram College of Commerce B.Com(h) Part-III Roll no.13/10 #9650430713 [Type the fax number] [Pick the date] DECLARATION I S.Ginmuansang Ngaihte hereby declare that the Project entitled Micro-finance in India submitted to University of Delhi in fulfillment for the degree of Bachelor in Commerce (honors). Whatever is written in this project is a bonafide work of mine and to the best of my knowledge. Place: Signature Date: ACKNOWLEGDMENT The satisfaction and euphoria that accompanied the successful completion of any task would be incomplete without the mention of the people who made it possible, whose constant guidance and support led to ultimate success. I would like to take this opportunity to express my profound gratitude and respect to my mentor Dr. Shuchi Pahuja, Associate Prof...
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...Indicators of Access to Finance 8 Access to Rural Finance: Evidence from the Demand Side 12 Access to savings/deposit accounts 14 Payments Services – Limited use, high cash economy 15 Access to Credit 15 Access to Insurance 17 The Importance of Informal Finance 17 III. WHAT CONSTRAINS ACCESS TO FINANCE FOR INDIA’S RURAL POOR? 19 Why Banks Are Reluctant To Lend to Rural Clients 19 Lack of credit information. 20 The tyranny of collateral 20 Weak legal framework and enforcement issues. 21 Government policy 21 Why Do Small, Rural Borrowers Find Rural Banks Unattractive? 26 Absence of flexible products and services 26 Transactions costs 26 Collateral 27 IV. RECENT EFFORTS IN INDIA TO IMPROVE RURAL ACCESS TO FINANCE: THE ROLE OF FORMAL—INFORMAL LINKAGES AND NEW PRODUCTS 28 SHG-bank Linkage Approach: Linking Commercial Banks to Grassroots Borrowers 28 How Effective Has SHG Bank Linkage Been in Targeting the Poor? 30 Impact on vulnerability of poor households 32 Some Lessons from SHG Bank Linkage 33 Key concerns: Limited outreach and scale of lending and issues in financial sustainability 34 Microfinance Institutions (MFIs) 35 What has constrained the outreach and scale of MFIs? 36 The “Service Provider” Model of Microfinance Piloted by Private Banks 37 The Kisan Credit Card 39 Recent Innovations in Micro- and...
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...Corporate Strategy Tameer Bank ‐ Micro Finance Banking Arsalan Aziz 2011 Instructor: Mr. Shahid Zaki EMBA PS‐IV (INSTITUTE OF BUSINESS ADMINISTRATION) Contents INDUSTRY BACKGROUND ................................................................................................................................... 4 TAMEER BANK .................................................................................................................................................... 5 Vision .............................................................................................................................................................. 5 Mission ........................................................................................................................................................... 5 Products ......................................................................................................................................................... 5 Tameer’s Tripple Bottom Line goals .......................................................................................................... 5 Projects in Progress for 3BL goals in 2008‐2010 ........................................................................................ 5 GENERAL ENVIRONMENT .................................................................................................................................. 7 . Technological Change .............................
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...| State of Microfinance in Bangladesh List of Acronyms ADB ASA BBS BDT BEES BIDS BKB BMDA BRAC BRDB BSBL CARB CBO CBN CDF CFPR CIDA COSOP CPD DANIDA DFID DOL DOF EC FSP FSS FY GB GDP GOB HCP HIES IBBL IFAD IGA IGVGD InM JC LGED ME MFMSP Asian Development Bank Bangladeshi NGO (formerly Association for Social Advancement) Bangladesh Bureau of Statistics Bangladesh Taka Bangladesh Extension Education Services Bangladesh Institute of Development Studies Bangladesh Krishi Bank Barind Multi-Purpose Development Authority Building Resources Across Communities (Largest NGO) [Formerly Bangladesh Rural Advancement Committee] Bangladesh Rural Development Board Bangladesh Sanchya Bank Limited Center for Agricultural Research-Barind (a Bangladeshi MFI) Community Based Organization Cost-of-basic-needs Credit and Development Forum Challenging the Frontiers of Poverty Reduction Programme Canadian International Development Agency Country Strategic Opportunities Paper (of IFAD) Centre for Policy Dialogue Danish International Development Agency Department for International Development Department of Livestock Department of Fisheries European Commission Financial Service for the Poorest Financial Self-sufficiency Fiscal Year Grameen Bank Gross Domestic Product Government of Bangladesh Hardcore Poor Program Household Income and Expenditure Survey Islami Bank Bangladesh Limited International Fund for Agricultural...
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...knowledge. As the classroom discussion alone cannot make a student perfect in handling the real situation, it is an opportunity for the students to know the real life situation through this program. The report on “Performance Analysis of Grameen Bank (GB), BRAC and ASA as MFI.” is prepared by Md. Jasim Uddin under the supervision and guidance of Muhammad Mujibul Kabir, Professor, Department of Finance, University of Dhaka and shubashish Barua, researcher, InM to meet the requirement of the internship program of BBA. 1.2 Objective of the Report Broad Objective: Broad objective of this report is to meet the partial requirements for the fulfillment of BBA program. Specific Objectives: Internship program aims at providing knowledge about the real world business situation. The objectives of the report are- ➢ To be informed with the top three MFIs of Bangladesh focusing on poverty alleviation. ➢ To get an overview of services rendered by different MFIs. ➢ To identify the critical success factors (CSF) of Microfinance institutions. ➢ To compare the relative performance analysis of top three MFI: Grameen Bank (GB), BRAC and ASA ➢ To identify the problems faced by the MFIs. ➢ To suggest what components should be incorporated with the Microfinance program that will reduce the risk of being vulnerable to poor. 1.3 Limitation of the Study In preparing the report, the main limitations that I faced were- • Regulation from the firm...
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