EBRD’s Post

Deciphering debt crisis in Cambodia’s microfinance A study by the Cambodia Microfinance Association (CMA) and M-CRIL, involving 3,262 households,found that nearly 87 percent of borrowers have one to two loans. Now, at the far end of the study, it was found 2.1 percent of those surveyed had taken as high as four or more loans. When applied to the larger sample size of 3.3 million borrowers in the country – this means 69,300 households taking loans from microfinance institutions (MFIs) are facing a debt problem. Khmer Times takes a look Vannak (name changed),aged 46, lives in Prek Prasab district in Kracheh with his wife and young daughter. He’s among the hundreds of those in Cambodia who due to unexpected circumstances fell into debt difficulties because of multiple loans taken.... https://bit.ly/3UWPWum #Cambodia #Microfinance #SoutheastAsia Rachel David Via khmertimeskh.com

People often ask me why I selected Islamic Micro-Finance bank to be added in my career? Islamic microfinance banks (IMFBs) are financial institutions that provide small-scale loans and other services to low-income people in accordance with the principles of Sharīʿah (Islamic law). The aim of IMFBs is to promote economic and social well-being of their clients and communities, as well as to spread the message of Islam through daʿwah (Islamic propagation). IMFBs use various Islamic contracts, such as murābaḥah (cost-plus sale), muḍārabah (profit-sharing), mushārakah (partnership), ijārah (leasing), and qarḍ ḥasan (benevolent loan), to offer interest-free and risk-sharing alternatives to conventional microfinance. IMFBs also pay zakat (Islamic alms) and make charitable contributions to support the poor and needy. IMFBs measure their performance not only by financial indicators, but also by social and spiritual outcomes. IMFBs are seen as a potential solution to alleviate poverty and unemployment, especially among the youth, in many Muslim countries.

📣 We are excited to announce that the Microfinance Centre has just launched the 10th edition of the international financial education campaign – Borrow Wisely 2024! In collaboration with 15 partners across Europe, we are promoting global client protection standards and helping clients borrow safely, avoid over-indebtedness and build trust in the microfinance sector. In 5 simple steps, the Borrow Wisely campaign empowers clients to: 💡 Understand how much they can afford to borrow 💡 Calculate loan costs and monthly payments 💡 Fully understand the contract before signing 💡 Keep control of debt without disrupting their lives 💡 Explore solutions if they are unsatisfied with loan terms A big thank you to all our partners: Prima Finantare MicroInvest VITAS IFN SA @Partner Microcredit Foundation fondiBESA sh.a Micro credit Institution MKF MIBOSPO Association of Microfinance Institutions in Bosnia and Herzegovina FED invest Mikrokreditna organizacija EKI iute Albania NOA.Financojme microsmart.gr Agro Social Fund Sh.p.k @Horizonti Microfinance Fondation Штедилница Можности / Stedilnica Moznosti for joining us in making a significant impact in promoting responsible borrowing practices, highlighting the importance of planning, understanding contracts and managing debt effectively. #borrowwisely #smartbusiness #financialplanning #microfinance

Just like all banks are overseen by the Bank of Uganda, Tier 4 Microfinance Institutions, including SACCOs, Non-Deposit Taking Microfinance Institutions, and Money Lenders, are monitored by UMRA to ensure fair and transparent practices. #WeGuideYouProsper

Looking for customized funding for your Small and Medium Enterprise, the Equity Youth Loan is the answer to your worries. Visit any #EquityBankUganda branch near you or call +256312327000 for more information regarding this product. To access this loan product; 1. The SME owner must be employing 5 or more youths. 2. The business must have been operational for a period of 6 months. 3. The borrower must have an #EquityBankUganda account. 4. The borrower's credit history with Equity Bank Uganda will be checked to easily determine how much can be lent to you. 5. The borrower must have collateral / security worth the amount of money he/she intends to borrow.

Diaspora & NBE initiative: The National Bank of Ethiopia (NBE) has launched remittance and financing initiatiatives to encourage over 3.5 million Ethiopians abroad to remit funds via banks by offering attractive exchange rates, opening accounts in local or foreign currency with attractive saving rate and incentives and taking advantage of allocated credit of about Birr 100 billion for investment, mortgage, vehicles loans, and etc linked to remittances. The initiative has created new platform called Unite.et which will allow Ethiopians and foreigners of Ethiopian origin to open bank accounts in Ethiopia virtually. The implications: 1) Better investment and business opportunities for our diaspora communities, with improved incentives and access; 2) Potential growth for remittances and FDI; 3) Improvement or an ease of tighter monetary policy (credit cap) that limited banks to lend; 4) possible Upturn in property markets (real estate and car). The Challenge needs to be addressed: There must be mechanism that help to address the diaspora's physical presence to provide finger print required to have tax identification number (TIN) as prerequisite of loans.

Corporate bonds are a great way of investing in the capital markets if you are more inclined towards securities that offer more certainty in your investment planning. They follow the same format as a government bond in the sense that it is a debt instrument with a predetermined fixed interest rate, fixed coupon dates if applicable and a fixed maturity date however in this case you are dealing with a company as opposed to the government. As always before investing your hard-earned money into any investment vehicle, please seek out the expert advice of a financial advisor. Happy investing!

Thrilled to share our latest publication! Our team's research on "The Effect of Microfinance Banks on Small Businesses Growth in Nigeria" has been published in the SCOPE Journal! This seminar highlights the crucial role microfinance banks play in supporting small businesses in Nigeria. Our findings reveal both short-term challenges and long-term opportunities for growth. Key takeaways: - Microfinance banks have a significant impact on small business growth, but it's negative in the short term and positive in the long term. - Microfinance institution size has minimal influence on long-term success. - Microfinance loans have a negative short-term effect but a positive long-term impact. Recommendations for policymakers and microfinance institutions: - Focus on effective deposit mobilization and sustainable long-term financing models. - Prioritize microfinance service quality over institution size. - Encourage high-quality financial services, including timely and affordable credit, savings, insurance, and more. - Foster responsible lending practices with robust screening, monitoring, and financial education. Read the full publication here: https://lnkd.in/dz8U6YPp Special thanks to my co-authors: Yusuf Wasiu A., E. O. Oyegoke, B. A. Adewumi, T. Moronfolu, T. D. Adisa, and A. D. Nuhu. Let's continue to advance knowledge and drive impact in the financial sector! #Microfinance #SmallBusinessGrowth #FinancialInclusion #ResearchToPractice

Al Qaeda frequently moved money it raised by hawala, an informal and ancient trust-based system for transferring funds. In some ways al Qaeda had no choice after its move to Afghanistan in 1996: first, the banking system there was antiquated and undependable; and second, formal banking was risky due to the scrutiny that al Qaeda received after the August 1998 East Africa Embassy bombings, including UN resolutions against it and the Taliban. Bin Laden relied on the established hawala networks operating in Pakistan, in Dubai, and throughout the Middle East to transfer funds efficiently. Hawaladars associated with al Qaeda may have used banks to move and store money, as did various al Qaeda fund-raisers and operatives outside Afghanistan, but there is little evidence that Bin Laden or core al Qaeda members used banks while in Afghanistan

Since 2008, MicroLoan Foundation Zambia has been transforming lives by providing small business loans, savings services, and entrepreneurial training to underserved rural communities. We are currently supporting over 45,000 female entrepreneurs across Zambia, via our 16 branches and 12 satellite areas. With 77% of Zambians living below the $2.50 a day poverty line, our mission is to scale up and reach more communities. In 2017, we introduced a pilot programme in our Chipata and Petauke branches, offering mobile money services. This technology has been rolled out to all branches, with 100% of loan disbursements and 60-70% of repayments now processed electronically. By reducing cash transactions, operations are more efficient and clients have access to a safer, more convenient way to manage their loans and businesses. MicroLoan Zambia is at the forefront of digital financial services and innovation, with new digital systems and savings products under development to reach more households. To find out more about our operations in Zambia, visit: https://zurl.co/8FKE #EmpowerWomen #FinancialInclusion #PovertyReduction #Zambia #SustainableAgriculture #MobileMoney #Microfinance #WomenInBusiness