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Creating Value with Leasing in Emerging Markets

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					  A BI-MONTHLY NEWSLETTER WHICH DISSEMINATES INFORMATION ON IMPROVING ACCESS TO FINANCIAL SERVICES              SEPTEMBER 2010 | ISSUE No. 33



Creating Value with Leasing in Emerging
                                                                                                  PAYMENT SYSTEMS AND
Markets                                                                                           REMITTANCES
By Minerva Kotei, Global Product Leader, IFC Access to Finance Advisory                           Global Payments Week 2010. The
                                                                                                  biannual event organized by the World
                                                                                                  Bank. Amsterdam, The Netherlands.
RATIONALE                                                                                         October 19-22, 2010. (more on page 5)

   Leasing provides a means to deliver increased domestic investment within economies.            NONBANK FINANCIAL INSTITUTIONS
By developing additional financial tools such as leasing or mortgages, countries are able         (LEASING, HOUSING FINANCE
to deepen the activities of their financial sector by introducing new products and/or             INSURANCE)
industry players.                                                                                 Insurance in Developing Countries:
   Although leasing is used as a means of asset financing by all business types for assets        Exploring Opportunities in Micro-
                                                                                                  insurance. The potential market for
worth tens of dollars to tens of millions of dollars, its key benefit is the access it provides   insurance in developing countries is
those without a significant asset base: leasing enables small enterprises to leverage an          estimated to be between 1.5 and 3bn
initial cash deposit, with the inherent value of the asset being purchased acting as              policies ... (more on page 9)
collateral. These small businesses do not have other assets that could serve as collateral for
loans or other types of secured lending within countries where unsecured lending is not           CREDIT REPORTING & COLLATERAL
                                                                                                  REGISTRIES
an option. Developing leasing allows smaller scale entrepreneurs to become more
economically active by enabling access to finance and, subsequently, access to income-            Vietnam’s First Credit Bureau (PCB)
                                                                                                  Launches. The bureau is expected to
producing assets. Also, leasing offers an important advantage in countries with weak              supply     highly  credible    credit
business environments, particularly those with weak creditor’s rights and collateral laws         information about individuals and
and registries, such as countries where secured lenders do not have priority in the case of       organizations … (more on page 11)
default.
                                                                                                  Jordan, IFC Sign Accord to Set Up First
   As a result, leasing is sometimes the only financial tool available to provide small and       Movable Asset Registry. Jordan and the
medium enterprises (SMEs) with medium term finance to support investments in                      International Finance Corporation
productive and logistic assets. A dynamic leasing sector can greatly benefit the economy          (IFC), a member of the World Bank
of a country as it creates access to finance that, in turn, can create employment                 Group ... (more on page 12)
opportunities.
                                                                                                  INCLUSIVE FINANCIAL SYSTEMS
    Leasing also plays a critical role in bringing small businesses into the formal financial     Financial Access 2010: The State of
system. As informal businesses have access to lease financing, they start building a history      Financial Inclusion Through The
of financial transactions. When the appropriate credit information-sharing infrastructure         Crisis. Financial Access 2010 extends to
is in place, banks and other financial institutions can access these records, better manage       142 countries ... (more on page 14)
risks, and start providing more comprehensive financial services to these small
businesses. With this new opportunity, small businesses find a new incentive to join the
formal sector.
                                                                                                  AccessFinance is published by the
   Emerging economies almost always have an undercapitalized banking system that can              Financial & Private Sector Development
only offer its potential clients a limited range of products. For their part, the SMEs in         Vice Presidency of the World Bank Group
emerging economies possess insufficient collateral or credit history to access more               Editors: Bikki Randhawa, Leila Search
traditional bank finance. This results in a shortage of available credit to domestic              Layout/Production: Aichin Lim Jones
entrepreneurs. Developing the leasing sector as a means of delivering finance increases
                                                                                                  Editorial Committee: Massimo Cirasino,
the range of financial products in the marketplace and provides a route for accessing
                                                                                                  Maria Teresa Chimienti, Shalini
finance for businesses that would otherwise not have it, thus promoting domestic                  Sankaranarayanan, Vijay Kalavakonda,
production, economic growth and job creation.                                                     Alejandro Alvarez de la Campa

                                                                              (more on page 2)
                                                                                                  For subscription, please visit us online at
                                                                                                  AccessFinance.

                                                                                                  For comments/suggestions, please send to
This article was culled from a World Leasing Yearbook 2010 article by Minerva Kotei and           accessfinance@worldbank.org.
Ary Naïm.
  ACCESSFINANCE | SEPTEMBER 2010 | ISSUE No. 33                                                                                           PAGE 2


Creating Value with Leasing in Emerging Markets
(continued from page 1)

   Many developing countries suffer from          between loans and leases to the benefit of        bank and non-bank institutions in the areas
weak or imperfect legal institutions.             SME clients and overall economic                  of governance, strategy, risk management
Although in principle secured lending and         development. In many cases, regulations           and operations.
leasing should be roughly equivalent in           either did not exist, did not take into              IFC’s most pivotal role in leasing
terms of risk, experience in many                 account the specific characteristics of leasing   investments has been that of project catalyst,
jurisdictions has shown that legal ownership      or their application and interpretation were      bringing together domestic sponsors,
is recognized by all participants, especially     uncertain because of lack of precedent. More      foreign technical/financial partners and,
courts, more readily and consistently than        and more governments have turned to IFC           where needed most, government authorities
secured lending. This can reduce the risk to      for help in laying out the groundwork for         to ensure that the project is commercially
lenders (lessors) considerably. The value of      leasing development as they recognize these       viable, organized on sound management,
this advantage of leasing should not be           weaknesses.                                       operating and financial principles and will
underestimated, particularly in more                 Building on fundamental support to the         be operated in a conducive regulatory
challenging environments.                         industry, advisory work is now focused on         environment.     The    formulation      and
                                                  institution building activities to help set up    establishment of operating policies provide
LEASE MARKET DEVELOPMENT                          and expand strong leasing businesses and          leasing companies with a specialized focus
   Creating a sustainable leasing industry in     thereby facilitate the development of a           on industrial equipment and, in many cases,
developing countries requires investment          strong and sustainable leasing industry.          on small and medium-sized borrowers.
and technical know-how provided to policy-        Advisory services are now targeted at leasing
makers, regulators and private-sector
players. To address this specific need, IFC
provides advisory programs that are co-
financed by multilateral and bilateral donors           LEASING PROVIDES ACCESS TO FINANCE UZBEKISTAN’S SMES
to increase micro, small, and medium
enterprises (MSMEs) access to term                         Uzbek Leasing has been a partner in the IFC Leasing Advisory Program in
equipment financing and broaden local                   Central Asia since 2002 and has further strengthened its operational capacity. The
financial markets. Direct advisory services             leasing sector in Uzbekistan is still small but growing rapidly. IFC played a role in
are provided to leasing clients in the areas of         developing the leasing sector in Uzbekistan, helping to amend 11 pieces of
operations, strategy, risk management and               legislation to facilitate leasing in the country. As a result of these regulatory
governance as well as broad support to the              improvements, targeted support at the company level and increased awareness,
leasing industry in developing countries,               the leasing market in Uzbekistan has grown by US$220 million from 2001 to2007.
addressing constraints through policy and
regulatory work, advocacy and awareness-                   The company’s clients are private SMEs, whose growth is critical for the
raising.                                                development of Uzbekistan’s economy. With total assets of $7.1 billion equivalent
    Many countries face structural obstacles            and declining banking penetration rates, the financing needs of the private sector,
in developing a leasing industry: the absence           particularly SMEs, were not being met. Without access to term finance, SMEs are
of clearly defined and predictable laws and             unable to implement investment plans and modernize existing facilities. Many
regulations governing leasing transactions,             small companies raised funds on the curb market, in cash, and often at
unclear accounting standards, the lack of an            significantly higher interest rates. IFC provided advisory services to Uzbek
appropriate tax regime, impaired funding                Leasing and granted them a loan targeted at addressing the scarcity of term
abilities and/or the absence of an                      foreign currency financing available for businesses to fund imported production
appropriate regulatory and supervisory                  equipment. In addition to supplying funding and boosting domestic investment,
framework. IFC has found that leasing                   the project should increase employment in the country and contribute to
typically does not need to be granted any tax           development of best practice.
or regulatory advantage to develop.
However, without specific texts and                        In August 2008, IFC committed a $3 million loan to Uzbek Leasing
regulations, leasing is at a disadvantage vis-          International, the first leasing company established in Uzbekistan. Today Uzbek
à-vis loans that are better understood by the           Leasing, which has IFC as one of its four shareholders, is one of the leading and
judicial, financial and commercial system.              most successful leasing companies in the country. Uzbek Leasing has served as a
Therefore, the focus is to help governments             model that has led other leasing companies to launch operations in Uzbekistan.
establish a level-playing field for leasing,
allowing increasing and fair competition
     ACCESSFINANCE | SEPTEMBER 2010 | ISSUE No. 33                                                                                               PAGE 3


Creating Value with Leasing in                       The viability of NBFIs has been                      themselves. On the supply side, leasing can
Emerging Markets                                     challenged                                           help a bank obtain higher returns through a
(continued from page 2)                                 Historically,     stand-alone        leasing      relatively lower risk and diversified product
                                                     companies        as   non-bank        financial      offering. It can also be less risky than
IMPACT                                               institutions (NBFIs) have been instrumental          traditional lending.
   The focus on leasing is due to its strong         for the promotion of SME access to finance
                                                                                                             Beyond the crisis, as banks adopt lessons
impact in financial market development and           in emerging markets. NBFIs are generally
                                                                                                          learned, they will explore new, relatively low
in supporting underserved SMEs. Leases are           the first players to enter nascent leasing
                                                                                                          risk products to offer. Key success factors for
often the only form of term financing SMEs           markets, particularly in the most frontier
                                                                                                          bank lease operations include product
or start-ups can obtain in developing                markets. However, they are more vulnerable
                                                                                                          knowledge, asset management expertise and
markets as banks often do not serve them             to adversity than banks because of their
                                                                                                          risk    management.        Successful     lease
well.                                                limited access to and relatively higher cost of
                                                                                                          operations require a cultural shift from
   Supporting SMEs is an important factor            funding. They often suffer from banking
                                                                                                          traditional banking to leasing, an asset
for alleviating poverty. A major barrier to          competition as banks start developing
                                                                                                          backed product.
their growth is a lack of access to finance. An      leasing products. First mover companies
                                                     may initially have an advantage in pricing              Bank sponsors often have stronger
effective approach to financing SMEs is by
                                                     and play a strong development role, but              incentives to and are absorbing independent
supporting leasing companies, banks and
                                                     their advantage may be eroded quickly if             leasing companies, either by buying a
other financial institutions that serve these
                                                     banks enter the market.                              substantial stake of or taking their market
enterprises.
                                                                                                          share. Law-makers and regulators should
   IFC collected and analyzed data from its             In the long run, the strongest NBFIs
                                                                                                          therefore encourage the ability of banks to
SME       focused     financial    institution       ensure their sustainability by specializing in
                                                                                                          offer leasing products, directly or through
investment clients for four years to better          specific niches such as vendor partnerships,
                                                                                                          fully or partially owned subsidiaries for
understand the composition of their                  operating leases or industry clusters.
                                                                                                          increased     outreach    and     maximum
portfolios. In FY08, 197 of MSME-focused             Ultimately, the development of a strong
                                                                                                          development impact.
financial institution clients in 73 countries        leasing sector in a given country strongly
were surveyed, 25 of whom were leasing               benefits from the entry of commercial banks
                                                     in the leasing business, as demonstrated in          New and Innovative Business
investment clients.                                                                                       Opportunities Exist
   Client institutions spanning 18 countries         almost all countries in which leasing
                                                     penetration is above 10 percent of fixed                 For leasing to realize its full impact, there
extended 193,000 leases for a total disbursed                                                             is a need to find new and innovative ways to
amount of US$5.2 billion to MSMEs globally           capital formation.
                                                                                                          integrate leasing in key sectors and
in 2007.                                                                                                  initiatives, including the following:
                                                     Banks will take the lion’s share of the
• The average outstanding lease size was                                                                  Sustainable Energy Finance
                                                     leasing market
  US$3,180 for micro leases, $20,498 for
                                                         In the context of the financial crisis, it has       Leasing can support the global climate
  small leases and $207,146 for medium
                                                     become clear that leasing companies that are         change and sustainability agenda by
  leases.
                                                     part of a solid bank with a stable source of         financing sustainable energy equipment.
• The average rate of non-performing loans           retail deposit funding will have better              Lack of financing for energy efficiency
  (NPLs) was 3 percent for micro, 2 percent          chances of surviving the crisis. Stand-alone         equipment has been identified as a major
  for small and 2 percent for medium leases.         leasing companies dependent on whole-sale            barrier to the development of the energy
• IFC’s leasing clients MSME portfolio grew          borrowings will inevitably suffer. Banks have        efficiency industry. Leasing can help address
  by 19 percent in number and 47 percent             access to competitive local currency funding         this barrier and facilitate the financing of
  in volume.1                                        mainly through their deposits and are able           equipment in energy efficiency, renewable
                                                     to leverage on their branch network to reach         energy and cleaner production. Leasing can
NEW LESSONS FOR LEASE MARKET                         more SMEs. They have proven to be                    directly address the credit issues related to
DEVELOPMENT                                          generally strong sponsors with sustainable           smaller-size     investments     and    small
   Leasing in emerging markets has                   SME outreach in the long run.                        businesses. It can also represent a large
witnessed unprecedented growth and                                                                        source of funding for projects, and its
                                                         Leasing can be offered by banks as
significance over the past 35 years. However,                                                             flexibility    offers     opportunities   for
                                                     another product within the bank through a
much needs to be done to increase lease                                                                   structuring and developing appropriate
                                                     wholly owned subsidiary or a joint venture
penetration rates and to obtain maximum                                                                   replicable models. Lease financing can be
                                                     with technical and other partners that
development impact. Recent market trends                                                                  used in projects of all sizes, from large
                                                     operate independently of the bank. By
and changes in the global leasing landscape                                                               industrial projects such as cogeneration,
                                                     increasing the range of products available as
attest to this and call for a dynamic approach                                                            through mass market programs like compact
                                                     well, banks not only create value for their
to sustained lease market development in                                                                  florescent to residential appliances.
                                                     clients, SMEs in particular, but also for
emerging markets.

1
    CAGR: Compounded average growth rate based on 11 leasing clients that continuously reported from CY05 to CY07
  ACCESSFINANCE | SEPTEMBER 2010 | ISSUE No. 33                                                                                          PAGE 4


Creating Value with Leasing in                    for    agri-processing   and the       food     IFC leasing projects have indicated strong
Emerging Markets                                  manufacturing businesses, thus facilitating     positive impact on private sector
(continued from page 3)                           increased food production and distribution.     development, particularly in the SME sector.
                                                     Because of the difficulty in finding            The impact of the financial crisis has
   Leasing can help banks, leasing                suitable collateral, most banks and leasing     influenced the market. However, leasing is
companies and other financial institutions        companies are averse to providing credit to     and will continue to form an integral part of
(FIs) better manage the risks associated with     farmers. By strengthening the leasing sector,   Access to Finance models, as it bridges the
financing the sustainable energy industry. It     farmers and agribusiness companies will         SME finance gap and fuels economic
can help increase the range of products and       find it easier to access term equipment         development. IFC will continuously explore
thereby create value for both the financial       financing.                                      new and innovative ways of creating
institution and its clients while increasing                                                      opportunities and value through leasing,
market share.                                     CONCLUSION                                      particularly where the objective is to help
Agriculture Equipment Financing                      Leasing has a strong development impact      small businesses access the financing they
                                                  and plays a critical role to bridge the SME     need to grow and develop.
   Growth in agriculture is constrained by
limited access to credit. Leasing can play a      finance gap and promote financial sector           Leasing is and continues to be an
key role in addressing this access to finance     development. The establishment and              important    financing   mechanism       in
problem by providing term equipment               commitment of over $21 million of               emerging markets and OECD countries. The
financing,        thereby          improving      resources from IFC and its development          development impact of IFC’s leasing work in
mechanization, especially in rural areas.         partners, coupled with over $1.4 billion in     emerging markets has been strong.
Leasing can also be used to finance a broad       investment projects by IFC in emerging          However, there is still a lot to do for
range of equipment across the agribusiness        markets has facilitated the growth of leasing   governments, financial institutions and
value chain, from simple tools to equipment       in these markets. Independent evaluations of    SMEs to realize the full potential of this
                                                                                                  important product.




PAYMENT SYSTEMS

NEWS                                              however, the doubters may have proved             institutional and policy issues. Part II
   Bharti Airtel Gets RBI Nod to Start            wrong. Foreign Policy, August 27, 2010.           reviews the market infrastructure for the
Mobile Payment Services. Bharti Airtel has           Touting Cost Savings, NACHA Launches           handling of financial transactions in euro
become the first mobile operator in India to      Pilot for Deposited Checks. Deposited             and key legislation. Part III explains the roles
receive a license from the Reserve Bank of        Check Truncation (DCT) is a method                and policies of the Eurosystem in this field.
India to start mobile payment services. The       intended to cut processing costs for banks        European Central Bank, edited by Tom
Hindu Business Line, September 15, 2010.          compared to the cost to clear check images.       Kokkola, September 2010.

   EU unveils crackdown on derivatives.           Digital Transactions, August 24, 2010.               Special Issue: Central Bank Liquidity
New proposed rules aim to bring more                 US Senate Passes Financial Reform. The         Tools and Perspectives on Regulatory
transparency to the often opaque world of         US Senate finally passed a landmark reform        Reform. The papers in this special volume of
“over-the-counter” derivatives – financial        regarding Wall Street on Thursday July 15,        the Economic Policy Review all focus on the
instruments traded off-exchange between           ushering in a raft of restrictions on banks.      theme of a 2009 conference on central bank
two parties. Financial Times, September 15,       Financial Times, July 15, 2010.                   liquidity tools organized by the Federal
2010.                                                                                               Reserve Bank of New York. Federal Reserve
                                                  RECENT PUBLICATIONS                               Bank of New York, Economic Policy Review,
   ECB to Create 'Super Regulators' for
                                                     The Payment System – Payments,                 Volume 16, Number 1, August 2010.
Banks. The European Union took its first
step towards the creation of three super          Securities and Derivatives, and the Role of          China ATM (Automatic Teller Machine)
regulators that could eventually take direct      the Eurosystem. A comprehensive 370-page          Industry Report, 2009-2010. Based on
responsibility for the oversight of individual    insight into the handling of financial            statistics from People’s Bank of China,
member states’ financial systems. The             transactions, the functioning of financial        China Banking Association and China
Telegraph, September 3, 2010.                     market infrastructure, and the role of the        UnionPay, this report studies the status quo
                                                  Eurosystem. Part I examines key concepts          of ATM industry in China as well as the
   The M-Banking Revolution. As recently
                                                  and processes in market infrastructure            operation of leading ATM manufacturers
as two years ago, mobile banking in the
                                                  services of modern economies and                  around the world. Also, it analyzes the ATM
developing world was an object of
                                                  underlying economic, business, legal,             procurement and placement of every bank
skepticism among financial insiders. Now,
  ACCESSFINANCE | SEPTEMBER 2010 | ISSUE No. 33                                                                                           PAGE 5


Payment Systems                                   Counterparties (RCCP) to the CCPs clearing         significant portion of OTC derivatives
(continued from page 4)                           over-the-counter      (OTC)      derivatives       transactions to CCPs would require large
                                                  products (OTC derivatives CCPs). The               increases in posted collateral, requiring large
and predicts the investment opportunities         World Bank actively participated to this           banks to raise more capital. These costs
and risks in ATM industry in the future.          effort, through the Payment System                 suggest that most large banks will be
Research and Markets, August 2010. (For           Development Group. Bank for International          reluctant to offload their positions to CCPs,
purchase)                                         Settlements, Committee on Payment and              and the paper proposes an appropriate
   Liquidity Costs and Tiering in Large-          Settlement Systems, CPSS Publications No 89,       capital levy on remaining positions to
Value Payment Systems. This paper                 May 2010.                                          encourage the transition. IMF Working
develops and simulates a model of the                 Report on the Brazilian Payment Cards          Paper 10/99, by M. Singh, April 2010.
emergence of networks in an interbank,            industry. In July of 2006, the Central Bank of         Mobile Banking and Payments. After
RTGS payment system. A number of banks,           Brazil, the Secretariat of Economic Law of         abandoning initial rollouts a few years ago
faced with random streams of payment              the Ministry of Justice (SDE), and the             following poor consumer take up, banks
orders, choose whether to link directly to the    Secretariat for Economic Monitoring of the         worldwide are now re-entering the market.
payment system, or to use a correspondent         Ministry of Finance (SEAE) celebrated a            This report assesses the role of the mobile
bank. A calibration exercise on data from         technical cooperation memorandum aimed             phone as a banking device as well as a
the UK CHAPS system suggests that the             at carrying out joint studies relating to retail   payment function. Case studies and
model is able to generate realistic               payment systems. This report, which is the         examples include: Bank of America, Citi,
predictions, i.e. a network topology similar      first outcome of that effort, aims to identify     Facebook, First National Bank, iTunes,
to that observed in reality, driven solely by     potential market failures stemming from            Microsoft, Nokia, Paypal, Twitter, Visa,
the underlying pattern of payments and the        market’s organization and practices, so as to      Wells Fargo, Wizzit and others. VRL
structure of liquidity costs. Central Bank of     become a reference for possible steps              Reports, April 2010 (for purchase).
England, Working Paper No.399, by M.              towards social welfare improvements.
Adams, M. Galbiati and S. Giansante, July         Central Bank of Brazil, SDE, SEAE, May             UPCOMING EVENTS
2010.                                             2010.                                                 Cards Latin America. Cards Latin
    Payments     in    Mobile     2010-2015.          Payments and Securities Settlement             America is the networking event of the year
According to the GSMA there will be 1.7           Systems in Pakistan. The Payment Systems           for the Latin cards and payments industry. It
billion mobile phone users by the end of          Development Group (PSDG) at the World              brings together a targeted group of cards
2012 that do not possess a formal bank            Bank has published the first “color” book of       executives in one place at one time for
account. Mobile subscriber penetration            the “purple” series, produced in the context       unparalleled access and networking
worldwide will continue to increase with          of the World Bank South Asia Payments and          opportunities. Organized by Terrapinn.
over 5.4 Billion handsets in circulation as of    Securities Settlement Initiative (SAPI). The       Coral Gables, FL. October 4-6, 2010.
the end of 2015. The ubiquity of the mobile       report, in collaboration with the State Bank          Prepaid Cards LatAm 2010. An entire day
phone will bring to the floor the potential       of Pakistan (SBP), contains a systematic in-       to discuss the avenues for growth of prepaid
for m-banking and the wider potential of m-       depth description of Pakistan’s payments           cards in Latin America, from government
payment services enabled by the mobile            and      securities   settlement     systems.      benefits, to transportation, to retail.
phone. This report examines the                   Additional reports for South Asia, including       Organized by Terrapinn. Coral Gables, FL.
opportunities and challenges for m-               Bangladesh, Nepal and Bhutan will follow.          October 6, 2010.
payments to become readily accepted in the        The World Bank, April 2010.                           Global Payments Week 2010. The
developing      and    developed      market.        Collateral, Netting and Systemic Risk in        biannual event gathering central banks and
Visiongain, June 2010. (For purchase)             the OTC Derivatives Market. To mitigate            securities commissions from all over the
   Guidance on the application of the 2004        systemic risk, some regulators have                world. Organized by the World Bank.
CPSS-IOSCO Recommendations for Central            advocated the greater use of Central               Amsterdam, The Netherlands. October 19-
Counterparties to OTC derivatives CCPs–           Counterparties (CCPs) to clear over-the-           22, 2010.
consultative report. Prepared by a working        counter      (OTC)     derivatives     trades.        SIBOS 2010. Once a year, Sibos brings
group jointly established in June 2009 by the     Regulators should be cognizant that large          together the financial industry to create
Committee on Payment and Settlement               banks active in the OTC derivatives market         opportunities for individuals, organizations
Systems (CPSS) and the Technical                  do not hold collateral against all the             and the community as a whole. Facilitated
Committee        of     the     International     positions in their trading book, and the           and organized by SWIFT, this forum creates
Organization of Securities Commissions            paper proves an estimate of this under-            the stimulus for learning, collaborating,
(IOSCO), this report presents guidance on         collateralization. Whatever collateral is held     developing new business, defining future
the application of the 2004 CPSS-IOSCO            by banks is allowed to be re-used to others.       strategies and taking collective action.
Recommendations             for       Central     Since CCPs would require all positions to          Amsterdam, The Netherlands. October 25-
                                                  have collateral against them, off-loading a        29, 2010.
   ACCESSFINANCE | SEPTEMBER 2010 | ISSUE No. 33                                                                                         PAGE 6


Payment Systems                                    prepaid role in the evolution, update on           SPEED. “Settlements, Payments, E-
(continued from page 5)                            regulatory and legal developments, and          money & E-trading Development” is a new
                                                   share best practices on mobile payment          quarterly journal from Central Banking
   Mobile Money Transfer Global. Bringing          technologies. Organized by IQPC. Denver,        Publications which focuses on policy
together leading players from across the           CO. June 28-30, 2010.                           developments          affecting financial
entire MMT ecosystem, MMT Global will                                                              infrastructures at the national and
                                                      Payments Panorama 2010. The theme for
feature 40-plus top executive presentations                                                        international levels.
                                                   the Payments Panorama 2010 was
and global case studies. MMT Global will see
                                                   “Leadership, Change and Vision in the              The Lydian Payments Journal. Launched
over 400 people come together to network
                                                   Payments Industry”. The program featured        in 2009, and published on Pymnts.com, an
and discuss the latest industry developments
                                                   sessions on mobile payments, international      online media channel featuring news and
and explore the opportunities and challenges
                                                   standards, crime and payment, and               analysis on “what’s next” in the payments
facing the industry. Dubai, UAE. October
                                                   innovation and evolution in the retail          sector, this journal is specifically targeted to
25-26, 2010.
                                                   payments sector. Vancouver, Canada. June        the payments professionals.
   Expanding the Horizon of Payment                16-18, 2010.
Systems.     Global      Payment    System                                                         LINKS
                                                      Prepaid 2010. By 2015 MasterCard and
Conference organized by the World Bank                                                                World       Bank     Payment      Systems
                                                   PSE Consulting project the value of prepaid
Payment Systems Development Group                                                                  Development Group. For more than 12
                                                   spending to reach EUR131bn in Europe;
(PSDG) in the context of the IFC-World                                                             years the World Bank has been paying
                                                   winning prepaid businesses will identify and
Bank Financial Infrastructure Week, Rio de                                                         increasing attention to payment system
                                                   dominate a market niche. Prepaid 2010
Janeiro, Brazil, March 2011.                                                                       development, and has provided various
                                                   provided round tables and panels around an
   International Payments Summit (IPS)             agenda genuinely driven by audience             forms of assistance to over 100 countries.
2011. IPS - The World's Leading Payments           questions, with over 100 global prepaid            Bank for International Settlements. The
Conference. Over 400-plus attendees and            visionaries. London, UK. June 14-16, 2010.      Bank for International Settlements (BIS) is
110-plus international industry speakers.                                                          an international organization which fosters
                                                      5th Annual Underbanked Financial
Organized by ICBI. London, UK. March 21-                                                           international monetary and financial
                                                   Services Forum. This year's edition focused
24, 2011.                                                                                          cooperation and serves as a bank for central
                                                   on credit, payments and deposits. Miami,
                                                   FL. June 9-11, 2010.                            banks.
PAST EVENTS
                                                     infoDev Annual Symposium 2010: Clean,            Western Hemisphere Payment &
   AFI Global Policy Forum. The 2010 event
                                                   Green and Mobile. Making Technology             Securities Settlement Forum. The Western
will be a unique opportunity to review and
                                                   Work for the Poor. The Mobile Phone             Hemisphere Payments and Securities
assess progress on financial inclusion
                                                   Applications Panel discussion focused on        Clearance and Settlement Initiative (WHI)
policymaking, take stock of key activities,
                                                   how mobile services can effectively serve the   has become a regional forum to discuss
and share lessons learned, identify gaps and
                                                   poorest at the base of the pyramid.             relevant issues in the field of payments and
challenges to address bottlenecks and
                                                   Washington, DC. June 9, 2010.                   securities clearance and settlement.
further advance financial inclusion policy in
developing countries. Co-hosted by AFI and                                                            CIS-PI. Commonwealth of Independent
                                                   NEWSLETTERS AND JOURNALS                        States Payments and Securities Settlement
Bank Indonesia. Bali, Indonesia. September
27-29, 2010.                                         Dialogue. The Voice of the SWIFT              Initiative aims to assess payments and
                                                   Community.                                      securities settlement systems in the
    Effective Oversight of Payments, Clearing
                                                      International Banking Systems. IBS           Countries belonging to the CIS with a view
and Settlement Systems. This 4-day
                                                   Journal provides news, research and analysis    to improve their safety, efficiency and
programme aimed to equip payment
                                                   covering banking operations and systems         integrity.
systems experts in central banks to meet the
challenge to formulate an oversight                internationally. In addition to the monthly        SWIFT. The Society for Worldwide
framework for ensuring the safety and              IBS Journal and CFS Journal, reports, case      Interbank Financial Telecommunication
reliability of the payments, clearing and          studies and directories are also available      provides the proprietary communications
settlement systems, along with addressing          online.                                         platform for the exchange of financial
the issues of competition, accessibility,             Journal of Payments Strategy & Systems       information to over 8,300 customers in
efficiency and the prevention of fraud.            publishes peer-reviewed articles and case       more than 208 countries.
Sponsored by Central Banking. Cambridge,           studies analyzing best practice, emerging           CGAP. The Consultative Group for
UK. August 31 - September 3, 2010.                 issues and new thinking in how to develop a     Assisting the Poor aims to help build
   Prepaid Cards & Mobile Payments 2010            profitable, customer-focused payments           efficient and equitable local financial
Conference. This event examined innovative         strategy. Published by Henry Stewart            markets that serve all poor people with
payment technologies and forecast the              Publications.                                   convenient and affordable financial services.
  ACCESSFINANCE | SEPTEMBER 2010 | ISSUE No. 33                                                                                          PAGE 7


Payment Systems                                                                                        Migration and Development Brief 12:
                                                  RECENT PUBLICATIONS
(continued from page 6)                                                                             Remittance Flows to Developing Countries
                                                     Ten Years of Innovation in Remittances:
                                                                                                    Remained Resilient in 2009, Expected to
   Eurogiro    Network.      Through     its      Lessons Learned and Models for the Future.
                                                  Independent Review of the Multilateral            Recover During 2010-11. Officially recorded
community of postal organizations, banks
                                                  Investment Fund Remittance Portfolio. This        remittance flows to developing countries
and payment service providers, Eurogiro
                                                  report is a review of the Multilateral            reached US$316 billion in 2009, down 6
provides high quality solutions in the low-
                                                  Investment Fund’s remittance program              percent from US$336 billion in 2008. With
value payment market.
                                                                                                    improved prospects for the global economy,
                                                  since it’s start in 2000, when it began. The
   Payment News. This website presents the                                                          remittance flows to developing countries are
                                                  review focuses primarily on the portfolio of
latest news on the payment system industry.                                                         expected to increase by 6.2 percent in 2010
                                                  remittance projects undertaken by the MIF
                                                  from 2001 to 2009, and secondarily on the         and 7.1 percent in 2011, a faster pace of
REMITTANCES                                       MIF’s research and dissemination activities       recovery in 2010 than our earlier forecasts.
                                                  during that same time period. Inter-              The World Bank, by D. Ratha, S. Mohapatra
NEWS                                                                                                and A. Silwal, April 2010.
                                                  American Development Bank’s Multilateral
   Bangladeshi Remittances Hit Record             Investment Fund, by Joan Hall (Ayani NL              Migrant Remittance Flows: Findings
High. Bangladeshis working overseas sent a        Consultants), May 2010.                           from a Global Survey of Central Banks.
record $938 million home to their families                                                          Drawing on the findings from responses to a
                                                     A Review of International Migration
in August, confounding fears that the global                                                        2008-09 survey from 114 central banks
                                                  Policies. As flows of migrants from
economic crisis would trigger a flood of                                                            worldwide (33 of which are in Africa), this
                                                  developing countries to developed countries
returning migrant workers and a plunge in                                                           paper aims to better understand how central
                                                  grow over time, migration has become an
crucial remittances. Financial Times,                                                               banks and other national institutions
                                                  important issue that warrant good
September 7, 2010.                                                                                  regulate and collect data and other
                                                  management. This paper reviews migration
    Sri Lanka Remittances May Rise to                                                               information on cross-border remittance
                                                  policies that exist in various countries and,
Record $3.8 Billion After Civil War Ends.                                                           flows. The World Bank, by J. Irving, S.
                                                  especially those that could be applicable to
Remittances sent home by Sri Lankan               North and West African countries. The             Mohapatra, and D. Ratha, March 2010 (for
nationals overseas may rise to a record $3.8      remittance section investigates existing          purchase).
billion in 2010, a central bank official said,    mechanisms which could be used to increase           Remittances to Latin America and the
adding that policy makers will ensure             remittances and promote their investment,         Caribbean in 2009. The Impact of the Global
stability of the currency as the flows            reduce transfer cost, and encourage formal        Financial Crisis. Remittance flows to
increase. Bloomberg, September 7, 2010.           channel of remittances. Securitization and        countries in Latin America and the
   Deal of the Day: Money-Transfer                regulation of remittances are also                Caribbean (LAC) in 2009 were not immune
Companies      Evolve,      as    Remittances     mentioned. Programme for the Study of             to the impact of the global financial crisis.
Rebound. The money-transfer industry is           Global Migration, Graduate Institute of           The economic slowdown has resulted in a
fragmented, and needs to adapt to new             International and Development Studies,            15% decline in remittance receipts
competition, regulations and technologies.        Geneva, by N. Luckanachai and M. Rieger,          compared to 2008. However, analysis of data
Like other sectors, it is using the aftermath     2010.                                             from the last quarter of 2009 point to a
of the Great Recession to consolidate.                                                              possible stabilization of flows in 2010. Inter-
                                                     An Analysis of Trends in the Average
Financial Times, August 25, 2010.                                                                   American Development Bank’s Multilateral
                                                  Total Cost of Migrant Remittance Services.
                                                                                                    Investment Fund. March 2010.
   Philippine Remittances Rise, At a Cost.        The World Bank Group published the
Trade Union Congress of the Philippines           fourth update of the Remittance Prices
                                                                                                    UPCOMING EVENTS
secretary general Ernesto Herrera describes       Worldwide databases which tracks what
the rates the banks and other money transfer      migrant workers pay to send money to their           IMTC MIAMI 2010. This is fifth
firms slap on the remittances as "oppressive      family at home. The global average total cost     International   Money       Transmitters
and burdensome". Asia Times, August 19,           for sending US$200 is down to 8.72 percent        Conference organized by the National
2010.                                             but that average costs for some country           Money Transmitters Association (the
                                                  corridors are still as high as 22 percent, with   NMTA) and Mohr World Consulting
   Congress       Boosts         Remittance
                                                  some providers offering services at a cost        (MWC). Miami, FL. October 16-19, 2010,
Transparency in Reform Bill. The financial
reform includes long-needed remittance            that exceeds 40 percent. This Policy Note           Money Transfers London Summit
transparency standards that will help ensure      has been produced based on the latest data        (MTLS). Organized by IAMTN. London,
the safe and affordable transfer of money         collection in the Remittance Prices               UK. November 15-16, 2010.
from immigrant workers to their families          Worldwide database and will be updated               Money    Transfers Dubai  (MTD).
abroad. RemittancesGateway.org, July 17           periodically as new data becomes available.       Organized by IAMTN. Dubai, UAE. April
2010.                                             The World Bank Group, April 2010.                 19, 2011.
  ACCESSFINANCE | SEPTEMBER 2010 | ISSUE No. 33                                                                                      PAGE 8


Remittances (continued from page 7)

   Money Transfers Moscow (MTM).                  NEWSLETTERS                                      France: www.envoidargent.org (French)
Organized by IAMTN. Moscow, Russia.                  Migrant     Remittances     Newsletter.       Germany: www.geldtransfair.de
June 21, 2011.                                    Sponsored by the U.K. Department for           (German)
  Money Transfer & Migrant Remittances.           International Development (DFID) and the          Mexico:
Organized by ICBI. TBC. June 2011.                U.S. Agency for International Development      www.profeco.gob.mx/envio/envio.asp
                                                  (USAID), and produced by The QED               (Spanish)
PAST EVENTS                                       Group.                                           Netherlands: www.geldnaarhuis.nl
   Money Transfers Singapore 2010.                  Migration for Development. Facilitated       (Dutch)
Organized by IAMTN. The one-day                   by the EC-UN Joint Migration and
                                                                                                   Norway: www.sendepenger.no
conference was the second IAMTN                   Development Initiative (JMDI).
conference held on remittances in                                                                  UK: www.sendmoneyhome.org and
                                                     Money Transfer Newsletter. Maintained
Singapore. Delegates from money transfer                                                         www.moneymove.org
                                                  by the International Association of Money
companies, banks, mobile and card payment                                                           MIF. The Multilateral Investment Fund
                                                  Transfer Networks (IAMTN).
operators and technology providers as well                                                       (MIF) of The Inter-American Development
as regulators throughout Asia Pacific took        LINKS                                          Bank (IADB) seeks to promote inclusive
part in a packed one day event that will                                                         growth in Latin America through private
                                                     Remittance Prices Worldwide. The
addressed the key issues in the remittance                                                       sector development. The MIF recognizes the
                                                  World Bank Group Database provides data
world, in the largest receiving region in the                                                    impact of remittances on development and
                                                  on the cost of sending and receiving small
world. Singapore. September 21, 2010.                                                            works for making money transfers cheaper
                                                  amounts of money from one country to
   Money Transfer & Migrant Remittances.                                                         and safer.
                                                  another (Available in English, Arabic,
The third annual event organized by ICBI.         Chinese, French, Italian, Portuguese,             DFID. The Department for International
Among the topics of this year’s conference:       Russian and Spanish). New corridors and        Development (DFID) is an UK Government
the latest news on the World Bank 5x5             features available (March 2010).               Agency for international cooperation. DFID
objective; how the industry has responded to                                                     plays an important role in the field of
                                                     Global Remittances Working Group. The
the financial crisis; and mobile money – who                                                     remittances.
                                                  GRWG comprises of representatives from
will be the winners and losers? Barcelona,                                                          Inter-American      Dialogue.      The
                                                  the World Bank Group and interested
Spain. June 23-24, 2010.                                                                         Remittances and Development Program of
                                                  national authorities, and is chaired by the
  Money       Transfers   Moscow 2010.            World Bank-IFC Vice President for              Inter-American Dialogue seeks to encourage
Organized by IAMTN. Moscow, Russian               Financial and Private Sector Development.      remittances as a tool for development
Federation. June 7, 2010.                         Launched in January 2010, this website         throughout Latin America and the
   Remesamericas 2010: Remittances for the        informs about the structure and the            Caribbean.
Future. Remesamericas 2010 brought                activities of the GRWG.                           Mondato. Mondato Limited is an Irish-
together MIF project partners and other             World Bank Certified Regional and            based, international value transfer portal
market actors to disseminate best practices,      National Databases                             that offers a consumer search function to
innovative solutions, and lessons learned                                                        enable customers to find options for money
                                                     These databases cover regional and
over the 10 years that the MIF has been                                                          transfers that best suit their needs.
                                                  national remittance markets and fully
raising awareness about and financing                                                               RemittanceGateway.org. This website is
                                                  comply with the World Bank official
projects that use remittances as a                                                               meant for those interested in the field of
                                                  requirements for Remittance Prices
development tool. Organized by the Inter-                                                        migration and development. It is specifically
                                                  Comparison Databases.
American Development Bank’s Multilateral                                                         geared towards migrant remittances and
Investment Fund. Mexico City, Mexico. May           Italy: www.mandasoldiacasa.it (Italian)
                                                                                                 provides news, insights and contributions
6-7, 2010.                                          Australia  and       New          Zealand:   from leading international experts.
   Segunda Convención de la Asociación            www.sendmoneypacific.org
Iberomericana de Remesadoras. This is               Other National       Remittance     Prices
second forum organized by Asociación              Databases
Iberomericana de Remesadoras for money                These databases cover regional and
transfer operators in the world. Madrid,          national remittance markets and are not
Spain. April 8-10, 2010                           necessarily consistent with the methodology
                                                  of the World Bank Group database.
  ACCESSFINANCE | SEPTEMBER 2010 | ISSUE No. 33                                                                                           PAGE 9


NONBANK FINANCIAL                                 RECENT PUBLICATIONS                                cities. Doing Business investigates the ways
INSTITUTIONS (Leasing, Housing                       Microfinance Default Rates in Ghana:            in which government regulations enhance or
Finance, Insurance)                               Evidence from Individual Liability Credit          restrain business activity. The cities covered
                                                  Contacts. This paper presents evidence on          in Doing Business in Pakistan
NEWS                                              the factors that affect default probabilities in      2010 were selected jointly with Pakistan’s
   IFC Looks at Affordable Housing                individual-liability credit contracts. The data    Ministry of Finance. The International Bank
Projects in India. IFC is in talks with several   is drawn from a for-profit microfinance            for Reconstruction and Development / The
real estate developers and housing finance        lender in Ghana, and the sample consists of        World Bank. 2010.
companies to create large, affordable             nearly 1,000 randomly selected loans                  Insurance in Developing Countries:
housing projects in India with the hope of        approved between 2002 and 2007, three              Exploring Opportunities in Microinsurance.
one of the projects to be developed within        quarters of which were repaid. As default is       The potential market for insurance in
the next six months. Affordable housing has       relatively rare in microfinance, borrowers         developing countries is estimated to be
been tackled in other countries such as           who failed to repay their loans were over-         between 1.5 and 3bn policies. There is a
Mexico where 15,000 to 20,000 homes are           sampled. Impact of demographic, business           significant demand for a range of insurance
being built costing $7,000 to 15,000. In FY09     and loan characteristics are included on           products including health and life insurance,
and GY10, IFC’s highest exposure was in           default odds. It is found that repayment is        agricultural and property insurance and
India and will continue to invest                 affected mainly by the number of                   catastrophe cover. Microinsurance is
approximately $1 billion per year for the         dependents in the household, years in              effective in markets with little experience of
next two or three years. The Hindu Business       business, use of proceeds, loan status and         insurance – but it needs to be efficient,
Line, August 23, 2010.                            frequency of loan monitoring. By Gerald            cheap and simple. Llyods. 2010.
   High Cost of Healthcare Pushes Insurers        Pollio and James Obuobie. Microfinance
                                                  Information Exchange, Inc. September 2010.         UPCOMING EVENTS
to Launch Cheaper Covers. The high cost of
health care service in Africa is setting the         Financial Access 2010: The State of                Microfinance India Summit 2010.
stage for the launch of new innovative            Financial Inclusion Through the Crisis.            Organized by ACCESS Development, the
products targeting the low-end market,            Financial Access 2010 is the second annual         Microfinance India Summit 2010 will host
including Changamka, a micro-health cover         survey of financial regulators in more than        policy makers, practitioners, promoters,
launched by Changamka Micro-Health. The           140 countries by the Consultative Group to         academics, researchers and thought leaders
product allows members to receive                 Assist the Poor and The World Bank Group.          on various panels, and about 1,000 delegates
treatment at designated hospitals for a low       The survey found that the number of bank           from around the world will participate in the
cost. Additional microinsurance products          accounts around the world was growing              summit. The theme is “Mission of
like Bima Ya Jamii encourages savings while       even as the volume of loan and deposit             Microfinance- Need to Reflect and
providing risk cover, and Afya Milele which       accounts dropped. Sixty-five deposit               Reaffirm”, and the sessions will focus on
covers low-income families for in and out-        accounts were added per 1,000 adults in            current trends and issues relating to
patient care as well as maternity costs,          2009, representing 4.3 percent average             sustainability,     transparency,      social
doctors fees, daily hospital charges and          growth in the number of deposit accounts.          performance, commercialization of the
prescriptions. Business Daily, September 13,      The impact of the financial crisis could be        sector and client protection, among others.
2010.                                             more clearly seen in the use of credit             Sub-events will include Microfinance India
                                                  services, with the number of loans per 1,000       Awards which recognize the contribution of
   Foreign Policy: The Mobile Banking
                                                  adults broadly unchanged between 2008 and          individuals and institutions which have
Revolution. Mobile banking, or “m-
                                                  2009. Consultative Group to Assist the             played transformational roles in helping the
banking,” in the developing world caused a
large amount of skepticism from financial         Poor/The World Bank Group. September               sector grow in India, sponsored thematic
insiders. Three years ago M-Pesa was              2010.                                              roundtables which will present recent
launched as a mobile-money transfer service          Doing Business in Pakistan 2010. Doing          research findings, innovative and innovate
by Sararicom, the Kenyan subsidiary of            Business in Pakistan 2010 is the first             ideas with select audiences and the
Vodafone. In May, with about 10 million           country-specific subnational report of the         Knowledge Fair which will showcase various
customers in Kenya, Sararicom partnered           Doing Business series in Pakistan. The report      products, services and publications on offer
with Equity Bank and began M-Kesho, an            builds on the regional Doing Business in           by diverse stakeholders in the sector. New
interest-bearing savings account so that          South Asia 2005-7 series, which created            Delhi, India. November 15-16, 2010.
users are able to access mobile                   quantitative    indicators    on     business        6th     International   Microinsurance
microinsurance and microloan products.            regulations for six Pakistani cities. Doing        Conference. Call for proposals. Hosted by
NPR, August 30, 2010.                             Business in Pakistan 2010 documents                Munich     Re    Foundation     and   the
                                                  progress in the previously measured cities         Microinsurance Network supported by
                                                  and extends the analysis to a total of 13          GTZ/BMZ, the Department of Finance of
  ACCESSFINANCE | SEPTEMBER 2010 | ISSUE No. 33                                                                                        PAGE 10


NonBank Financial Institutions                       4th Global Conference on Housing                Ventures. A bi-annual production,
(continued from page 9)
                                                  Finance in Emerging Markets. World Bank        Ventures offers reflections on ACCION’s
the Philippines and Georgia State                 Group’s 4th Global Conference, Global          work, regional news highlights and first-
University’s Center for the Economic              Housing Finance After the Crisis, Drawing      hand accounts from staff in the
Analysis of Risk this event will have 500         the Lessons, Taking Stock, and Building the    field and individual stories of the working
participants and experts from around the          Future. Agenda and presentations now           poor succeeding with the help of
world to exchange experiences and discuss         online. Washington, DC, May 26-27, 2010.       microfinance.
the challenges of microinsurance. The
conference will have plenary panel                NEWSLETTERS                                    LINKS
discussions on key topics addressing an              Microinsurance Trilogy. This newsletter        PlaNet Finance. This site, available in
interdisciplinary audience. Parallel working      is published three times a year by the         English and French, is an international NGO
group sessions will deal in depth with            Microinsurance Network and is available in     that aims to alleviate poverty worldwide
different subtopics. Interactive sessions of      English, Spanish and French.                   through the development of microfinance.
approximately 90 minutes are a key part of
                                                     Microfinance Africa. A newsletter issued       Microfinance Information Exchange.
the conference, facilitating dialogue in small
                                                  by Microfinance Africa which includes          Also known as The Mix, Microfinance
groups on emerging issues. Manila,
                                                  recent updates in the microfinance sector in   Information Exchange delivers data services,
Philippines. November 9-11, 2010.
                                                  Africa.                                        analysis, research and business information
                                                     The Microinsurance Note Series is           on the institutions that provide financial
PAST EVENTS
                                                  written for USAID by Michael McCord of         services to the world’s poor.
   Frankfurt School of Finance &
Management Summer Academy, Housing                The      Microinsurance      Centre.   The        The Microinsurance Centre. The
Finance Course. - In cooperation with             Microinsurance Note Series provides an         Microinsurance Centre is focused on a
Housing Development Finance Corporation,          accessible, brief introduction to ten major    partnership model of microinsurance
India     this     course   will     provide      topics in microinsurance.                      provision. This site is intended to provide
comprehensive insight into all core topics of        InSight. As short, frequent, one-topic      practical tools to assist in the success of these
housing finance. Picking up on the newest         bulletins, InSight is intended to share the    relationships between regulated insurers,
developments and best practices in the            results of ACCION International's work         and MFOs and banks.
market, it will focus on conveying practical      with the microfinance community as quickly         LeapFrog Investments. LeapFrog is the
knowledge and tools for successfully              and efficiently as possible.                   first microinsurance fund and targets to
managing mortgage lending operations and             Microfinance Focus. Microfinance Focus      strong returns for investors while reaching
developing approaches and products that           is a global magazine on microfinance and       25 million vulnerable people in Africa and
meet the rising demand for housing finance.       sustainable development. It publishes news     Asia with life-changing financial services.
Frankfurt, Germany. July 25-30, 2010.             stories, articles and editorials written by    IFC invested $20 million in LeapFrog
   The Euromoney Egypt Housing & Real             experts who are practicing in the field.       Financial Inclusion Fund.
Estate Finance Conference: Financing                 Micro Insurance Voices. This newsletter        Microinsurance       Academy.      The
Egypt’s Housing Needs Investing in Real           highlights the activities of the Micro         Microinsurance Academy, or MIA, is a
Estate Development. Cairo, Egypt. June 15,        Insurance Academy, news and events, new        project of Sarvajan Unnati Bodhini
2010.                                             partnerships, and innovative research, and     Charitable Trust. MIA is a not-for-profit
   International Housing Finance Program.         among others, features perspectives from       organization fully dedicated to providing
This annual housing finance two-week              microinsurance experts.                        structured    technical    assistance  in
program from The Wharton School of the                                                           microinsurance     domain-knowledge    to
                                                     MicroInsurance Times. A newsletter
University of Pennsylvania provides the best                                                     organizations that focus on low-income
                                                  (currently in pilot phase) from MicroCapital
available in-depth review of international                                                       communities.
                                                  covering microinsurance briefs, news,
best practices in housing finance. It presents    interviews and events.                            LIBISNet is an international insurance
a variety of tools and helps one to                                                              library whose online search feature contains
                                                      Prosper. Prosper is the development
understand how to use them. The program                                                          microinsurance       publications      from
                                                  activities supplement from ICMIF and
is useful for private sector bankers and for                                                     approximately 30 different libraries in
                                                  includes articles relating to the area of
public sector policy makers. Participants                                                        Europe.
                                                  development, including microinsurance and
come from private housing finance                                                                   CGAP is an independent policy and
                                                  Islamic microinsurance.
institutions, government finance agencies,                                                       research center dedicated to advancing
                                                     Catalyst Newsletter. Published by
academia and international development                                                           financial access for the world's poor. It is
                                                  Freedom from Hunger, it aims to contribute
agencies from both emerging and advanced                                                         supported by over 30 development agencies
                                                  to greater awareness of and enthusiasm for
economies. Philadelphia, Pennsylvania. June                                                      and private foundations who share a
                                                  the microfinance and health protection
7-19, 2010.                                                                                      common mission is to alleviate poverty.
                                                  initiative.
   ACCESSFINANCE | SEPTEMBER 2010 | ISSUE No. 33                                                                                         PAGE 11


NonBank Financial Institutions                        Doing Business. The Doing Business              Accion is a private, non-profit
(continued from page 10)                           project is a series of reports supported by     organization with the mission of giving
                                                   The World Bank which provides objective         people the financial tools they need to work
Housed at the World Bank, CGAP provides            measures of business regulations and their      their way out of poverty. By providing
market intelligence, promotes standards,           enforcement across 183 economies and            “micro” loans, business training and other
develops innovative solutions and offers           selected cities at the subnational and          financial services to poor men and women
advisory    services   to   governments,           regional level.                                 who start their own businesses, ACCION
microfinance providers, donors, and                                                                helps people work their way up the
                                                      Munich Re Foundation concerns itself
investors.                                                                                         economic ladder with dignity and pride.
                                                   with the great challenges facing the world
   Opportunity International. Opportunity          today including such topic as poverty and          Microinsurance Innovation Facility.
International provides microfinance loans,         microinsurance,     population     growth,      Housed at the International Labour
savings, insurance and training to over two        globalization,   diminishing     resources,     Organization’s Social Finance Programme,
million people working their way out of            environmental pollution and climate             the Microinsurance Innovation Facility
poverty in the developing world.                   change.                                         seeks to increase the availability of quality of
                                                                                                   insurance for the developing world’s low
                                                                                                   income families to help them guard against
                                                                                                   risk and overcome poverty.



CREDIT REPORTING


NEWS                                               credit means more production, a better          better quality. This preference is particularly
                                                   economy, and a possibility for each and         strong for banks’ branch decisions.
   India: Global Credit Bureau Experian
                                                   every one to progress" said Oscar Madeddu,      Furthermore, banks prefer subsidiary entry
Opens Doors in India. On August 12 the
                                                   Specialist with IFC’s Global Credit Bureau      only in countries where private credit
international credit information firm
                                                   Program. Inside Business on City 7, June 29,    bureaus exist with better credit information
Experian opened doors in India as the first
                                                   2010.                                           quality. Overall, results indicate that banks
CICRA-licensed credit bureau in India,
                                                                                                   are attracted to countries where the credit
making the country its 16th destination.
                                                   RECENT PUBLICATIONS                             reporting system helps reduce banks’
Experian had first approached RBI for
                                                       Bank Competition, Credit Information        information costs. Journal of Banking &
clearances in February. As per banking
                                                   Sharing and Banking Efficiency. The study       Finance, June 2010.
regulators, Axis Bank, Punjab National
Bank, Indian Bank, Union Bank, Federal             examines the effects of bank competition           Lending and Delinquency Risk. A study
Bank, Sundaram Finance together hold a 51          and information sharing via credit agencies     by credit bureau TransUnion suggests that
percent stake in the company. CNBC News,           on banking efficiency. Using a sample of        financial institutions could experience
August 11, 2010.                                   about 2,500 banks in more than 70               significant drops in the rate of delinquent
                                                   countries, the study finds that bank            accounts by establishing multiple lending
   Vietnam’s First Credit Bureau (PCB)
                                                   concentration reduces bank operating            relationships with individual customers.
Launches. The bureau is expected to supply
                                                   efficiency. Credit information sharing, on      TransUnion studied lending information
highly credible credit information about
                                                   the other hand, increases bank efficiency       from      six   "super-regional"    financial
individuals and organizations and it will also
                                                   and further attenuates the negative effect of   institutions-three banks and three credit
help small-and-medium-sized enterprises
                                                   bank concentration on bank efficiency. City     unions for the Decembers of 2007, 2008 and
(SMEs) and the private sector access credit
                                                   University of Hong Kong and Lingnan             2009. Some 19 million consumers were
quickly and easily. Vietnam, July 20, 2010.
                                                   University of Hong Kong, June 2010.             included in each review, and more than 400
   The first workshop on Financial                                                                 million credit relationships were evaluated
                                                      What Drives Foreign Expansion of the
Infrastructure launched by the World Bank                                                          during each period. The study examined the
                                                   Top 100 Multinational Banks? The Role of
in partnership with the Arab Monetary Fund                                                         correlation between the number of
                                                   the Credit Reporting System. The study
and the Union of Arab Banks was held in                                                            consumer accounts 30 days or more
                                                   explores how information costs, proxied by
Abu Dhabi on June 29, 2010. The major                                                              delinquent and the number of accounts the
                                                   characteristics of credit reporting systems,
session of the training focused on financial                                                       borrower held with the lender. Other
                                                   affect the foreign expansion of the top 100
infrastructure, credit rights, guarantee                                                           account types included mortgages, auto
                                                   multinational banks. The study finds that
systems and payment and settlement                                                                 loans, home equity lines of credit and other
                                                   banks prefer to expand operations in
systems."The economy does not move unless                                                          lending services. TransUnion, June 24, 2010.
                                                   countries where private credit bureaus exist
you have credit, and in most cases access to
                                                   or where the credit reporting system is of
  ACCESSFINANCE | SEPTEMBER 2010 | ISSUE No. 33                                                                                         PAGE 12

Credit Reporting                                  practices, adding that the introduction of        LINKS
(continued from page 12)                          value-added services will benefit both the           Financial Infrastructure – Credit
                                                  bureaus and their users and improve access        Bureaus. This website contains the latest
PAST EVENTS                                       to finance for the broader community.             news on the sector, publications and more
   World Consumer Credit Reporting                Daily News Sri Lanka, July 30, 2010.              related to credit bureaus and IFC’s work
Conference 2010. The WCCRC 2010 is a                                                                around the world.
two day event where senior representatives        NEWSLETTERS
                                                                                                       Doing Business provides objective
from Credit Bureaus around the globe as              ACAFI Newsletter. Quarterly newsletter
                                                                                                    measures of business regulations and their
well as industry related companies from           published by IFC’s Advisory Services in the
                                                                                                    enforcement across 178 countries and
various credit cultures will attend to discuss    Europe and Central Asia region focusing on
                                                                                                    selected cities at the subnational and
contemporary issues. Berlin, September 26 -       credit bureau project progress and
                                                                                                    regional level.
28, 2010.                                         developments in Azerbaijan, the Kyrgyz
                                                  Republic, Tajikistan and Uzbekistan.                 IFC Azerbaijan-Central Asia Financial
   Credit Information Bureau (CRIB – Sri
                                                  Volume II, May – August 2010.                     Markets Infrastructure Advisory Services
Lanka) “Credit Reports and Beyond”
                                                                                                    Project provides updated information on
Symposium. The Credit Information Bureau             Caribbean       Panorama.        Quarterly
                                                                                                    IFC’s regional financial market program for
(CRIB) recently held a symposium on               newsletter published by IFC Advisory
                                                                                                    Central Asia, including a component on
'Credit Reports and Beyond' for lenders in        Services in Latin America & the Caribbean
                                                                                                    credit reporting.
Colombo, Sri Lanka. IFC Principal Financial       in collaboration with the Canadian
Specialist Tony Lythgoe and other industry-       International Development Agency (CIDA).             Western Hemisphere Credit Reporting
reputed     speakers   enlightened   CRIB         Volume 1, July, 2009. Volume 2, October,          Initiative. World Bank-led initiative to
stakeholders about how credit bureaus can         2009. Volume 3, January 2010; and Volume          describe and assess credit and loan reporting
help to develop lending operations and            4, April 2010; Volume 5, July 2010.               systems in the Latin America and Caribbean
analytical models for risk management                                                               region, and develop improvement strategies
                                                     ViewPoints. Bi-monthly publication by
                                                                                                    and action plans using a standard
                                                  Fair Isaac Corporation.
                                                                                                    methodology.



COLLATERAL REGISTRIES / SECURED LENDING

NEWS                                              reform will include enactment of a law on         State Matthew Dunlap hosted a delegation
                                                  secured transactions and development of a         of banking executives from Palestine, Jordan
   IBA invites Bids for e-Registry Project.
                                                  movable collateral registry to publicize          and Lebanon who are participating in the
The Indian Banks' Association (IBA) has
                                                  lenders' security interests in movable assets     World Bank Study Tour. The delegation met
decided to fast-track the project to set up a
                                                  and to establish their priority in the assets.    with Department officials, representatives
central electronic registry. With a view to
                                                  The Jordan Times. August 27, 2010                 from InforME, the state’s e-Government
getting the registry up and running in six
                                                     Banks Now Accept Movable Assets as             partner, and local banking officials to
months, the association has invited bids
                                                  Collateral in Ghana. Ghana’s Collateral           discuss establishing a secured transactions
from qualified vendors to design, develop
                                                  Registry indicates a lot more banks are           registry, similar to the Uniform Commercial
and implement the central registry system.
                                                  accepting movable assets as guarantees for        Code (UCC) online filing system
The registry will have a data collection
                                                  loans. All banks have access to the new           administered by the Department of the
system where banks and housing finance
                                                  registry which will help improve credit flow      Secretary of State. Maine, Secretary of State.
companies can report details of all home
                                                  to businesses and drive down interest rates.      August 2, 2010.
loans transactions. The data dissemination
system will help lenders and the general          The registry was established in February this
                                                  year and has so far recorded a little over five   RECENT PUBLICATIONS
public access/search data on the status of a
property. Business Line. September 3, 2010        thousand assets. More than 2,000 requests            How Law Affects Lending. This paper
                                                  have been made by the banks with vehicles         investigates the effect of legal change on the
   Jordan, IFC Sign Accord to Set Up First
                                                  and goods in transit amongst the most             lending behavior of banks in twelve
Movable Asset Registry. Jordan and the
                                                  popular searches. Joy Business. August 11,        transition economies. First, banks increase
International Finance Corporation (IFC), a
                                                  2010.                                             the supply of credit subsequent to legal
member of the World Bank Group,
                                                                                                    change. Second, changes in collateral law
embarked on establishing the first movable           World Bank Group Study Tour from
                                                                                                    matter more for increases in bank lending
asset registry to enable lenders to file notice   Palestine, Jordan, and Lebanon meets with
                                                                                                    than do changes in bankruptcy law. This is
related to their proprietary rights. The          Maine Secretary of State. Maine Secretary of
                                                                                                    attributed to the different functions of
  ACCESSFINANCE | SEPTEMBER 2010 | ISSUE No. 33                                                                                      PAGE 13


Collateral Registries / Secured                   Austin, Texas, with several STS meetings          UNCITRAL. Working Group VI. United
Lending (continued from page 12)                  held during the conference. Austin, TX May      Nations Commission on International Trade
                                                  23-27, 2010.                                    Law. This working group covers Secured
collateral and bankruptcy law. While the             UNCITRAL - Third International               Transactions.
former enhances the likelihood that               Colloquium on Secured Transactions. The            Uncitral Colloquia. Uncitral Colloquia on
individual creditors can realize their claims     colloquium took place from 1-3, March 2010      Secured Transactions listed under security.
against a debtor, the latter ensures an           at the Vienna International Centre. Same as
orderly process for resolving multiple, and                                                          EBRD – Secured Transactions. EBRD’s
                                                  the first Colloquium, which took place on 20
often conflicting, claims after a debtor has                                                      Secured Transactions Project, includes data,
                                                  to March 22-23, 2002, and the second
become insolvent. By Rainer Haselmann,                                                            publications, core legal text, projects &
                                                  Colloquium, which took place on January
Katharina Pistor, Vikrant Vig. The Review of                                                      developments.
                                                  18-19, 2007, the Third Colloquium
Financial Studies / v 23 n 2 2010. 2010.          discussed possible future work in the area of      Corporate Registers Forum. The
   Moving        International     Secured        secured transactions and, in particular,        Corporate Registers Forum (CRF) is an
Transactions Law Forward. Spiros Bazinas,         further work after the completion of the        international not for profit organization for
senior legal officer, UN Commission on            supplement to the UNCITRAL Legislative          administrators of corporate and securities
International Trade Law, discusses the            Guide on Secured Transactions (“the             registers.
importance of UNCITRAL and provides               Guide”) dealing with security rights in            International Association of Commercial
readers with an update on the Commission's        intellectual property. Vienna, Austria,         Administrators      (IACA).     Professional
work to promote effective secured                 March 1-3, 2010.                                association for government administrators
transactions law around the world.                   IADB - Financial inclusion: The              of business organization and secured
   By Spiros Bazinas. The Secured Lender.         Democratization of Credit. Experts from the     transaction record systems.
July, 2010.                                       public and private sectors discussed secured       LLI, Legal Information Institute. The
    Secured Transactions Toolkit. This            transactions and how they can be used to        Legal Dictionary and Legal Encyclopedia
Toolkit provides technical advice and             expand financial services for the poor.         that provides materials and resources on
guidance on the implementation of secured         Washington, DC, February 26, 2010.              Secured Transactions Topic.
transactions law and institutional reforms in                                                        China Law and Governance Review.
emerging market countries. It guides the          LINKS                                           China Law and Governance Review is an
reader through the various stages of the             IFC/World Bank – Secured Lending. The        electronic publication of China Law and
project cycle (identification, diagnostic,        joint FIAS/IFC advisory services in secured     Development Consultants Co., Limited
solution design, implementation and               lending supporting the development of a         (“CLD”), a Hong Kong firm founded in
monitoring and evaluation) involved in the        well-functioning secured lending framework      2000 to support non-profit development
introduction of secured transactions              through a delivery model that focuses on        work in China. In addition to designing and
reforms. The recommendations presented            harmonizing laws, building electronic           carrying out projects with Chinese partners,
in the Toolkit are based on IFC’s experience      registries,    streamlining     registration    CLD advises foreign donors and other
in the secured transactions area, the             processes and eliminating unnecessary           organizations working in China. CLD
contributions of a number of experts in this      paperwork.                                      specializes in legal system development,
field, existing literature, reform experience        World Bank Global Insolvency Law             governance reform, women’s issues,
in a number of emerging market countries          Database (GILD). World Bank developed           educational reform and the emerging NGO
and the existing best practices in                Principles and Guidelines for Effective         sector in China.
jurisdictions with advanced secured               Insolvency and Creditor Rights Systems            Collateral Security Reforms. ADB,
transactions systems. World Bank Group.           (Principles). The Principles represent an       Roundtable Meeting of Chief Justices and
January 2010.                                     international consensus on best practices in    Ministers of Justice, Documents and
                                                  insolvency and creditor rights (ICR) and        Background Materials.
UPCOMING EVENTS                                   constitute the standard for benchmarking
   UNCITRAL Meetings for Working                  the effectiveness of ICR systems.
Group VI. Vienna, Austria, November 8-12,         Additionally on the site find the Reports on
2010; New York, April 11-15, 2010; Vienna,        the Observance of Standards and Codes
Austria, December 12-16, 2011.                    (ROSCs) which provide a template, based on
                                                  the World Bank’s Principles, to help
PAST EVENTS                                       countries evaluate their own insolvency and
  The 33rd IACA Annual Conference:                debtor-creditor relations systems.
Taking Your Administration to a Great State
was held at the Hyatt Regency Austin in
 ACCESSFINANCE | SEPTEMBER 2010 | ISSUE No. 33                                                                                     PAGE 14


INCLUSIVE FINANCIAL SYSTEMS

NEWS                                             can enjoy the benefits of a Visa product            The Ready Reckoner on Microfinance.
   Reserve Bank of India Reaches Out.            and experience a better alternative to a        Targeting the fraternity of researchers,
Reporting on the efforts of initiative by        cash-and-carry lifestyle. The campaign          evaluators and academics, the Reckoner
the Reserve Bank of India, in association        builds    upon     Visa’s  long-standing        lists various courses, useful websites,
with state-run and private banks which           commitment to extending financial               details of the experts working in the field,
seeks more help of the country, and              inclusion to more consumers, while at the       successful and innovative models of
particularly the poor, get access to credit      same time driving opportunities for Visa,       microfinance and articles/papers related
and other financial services. Wall Street        partners and clients. Global Banking            to microfinance sub-sectors like savings,
Journal, August 11, 2010.                        News, July 16, 2010.                            credit, transfer of money, etc. It offers a
                                                                                                 data base of as large as 300 key
    Nokia and India’s Yes Bank Tie Up for
                                                 RECENT PUBLICATIONS                             organizations in the sector. UNDP India.
Rural Mobile Banking. Nokia has tied up
                                                    Financial Access 2010: The State of          July 2010.
with YES Bank to launch mobile payment
                                                 Financial Inclusion Through The Crisis.            Microfinance Games. This paper
solutions in rural areas and push financial
                                                 Financial Access 2010 extends to 142            documents the findings from research
inclusion in the rural and semi-urban
                                                 countries, and builds on last year’s data to    carried out in an experimental economics
cities. As per the tie-up, Nokia Priority
                                                 update the statistics on the use of financial   lab in a large urban market in Lima, Peru.
Centres and multi-brand handset outlets
                                                 services, and analyzes changes that took        The       researchers     simulated    real
will help people in rural areas to open
                                                 place in 2009―a turbulent year for the          microfinance transactions with real
bank accounts with YES Bank. The new
                                                 financial sector in the majority of             microentrepreneurs, to interesting results
customers will also be helped in
                                                 economies around the world. In addition         – even surprising to some. The
performing basic transactions such as
                                                 to measuring the state of financial access,     researchers found that making the
debit/credit and transfer of funds. The
                                                 Financial Access 2010 expands on last           availability of future loans contingent on
Financial Express (India), August 7, 2010.
                                                 year’s work by reviewing three policy           repayment of a current loan was a major
   Rich I.P.O. Brings Controversy to SKS         areas relevant to the current financial         factor in dampening the borrower’s
Microfinance. SKS Microfinance is not            access     debate:    financial     inclusion   appetite for risk. Then, in contrast to
the first microlender to go public, and          mandates, consumer protection in                many of the predictions from theoretical
there has long been debate over whether          financial services, and access to finance by    work on microfinance, it is group lending
social enterprises should be turned into         SMEs. CGAP and World Bank Group.                that increases rates of risky investment –
giant commercial operations. Proponents          September 2010.                                 “risky” being a positive thing in terms of
of commercial microfinancing say the
                                                    Microfinance activities and the Core         potential for growth. This was particularly
money raised can provide even more
                                                 Principles     for     Effective    Banking     true when like-minded groups of
loans to the needy than relying only on
                                                 Supervision. The Basel Committee on             microentrepreneurs were allowed to form
charitable donations. But the I.P.O. for
                                                 Banking Supervision has issued the final        their own groups. By Xavier Giné, Pamela
SKS, one of the field’s biggest stock
                                                 version of its paper entitled Microfinance      Jakiela, Dean Karlan         and Jonathan
offerings yet, has caused its own type of
                                                 activities and the Core Principles for          Morduch. Financial Access Initiative . July
controversy. New York Times, July 29,
                                                 Effective Banking Supervision that              2010.
2010.
                                                 contains supervisory guidance for the              Innovations in Rural and Agriculture
   With Squeeze on Credit, Microlending          application of the Basel Core Principles        Finance. This set of 14 briefs clearly
Blossoms. Tight credit and the recession         for Effective Banking Supervision (BCP)         points out the importance of business
have increased the demand for smaller            to microfinance activities, and the range       realities faced by small farmers, including
loans in the United States, giving               of practices on regulating and supervising      low education levels, the dominance of
microlending a higher profile and                microfinance       activities.   Bank    for    subsistence farming and the lack of access
broadening its appeal. Both Kiva and             International Settlements (BIS). August         to modern financial instruments. These
Grameen Bank have widened their                  2010.                                           conditions mean that new and innovative
lending to Americans. New York Times,
                                                   State of Microfinance Investment: The         institutions are required to reach small
July 28, 2010.
                                                 MicroRate 2010 Survey. MicroRate’s 5th          farmers. By Renate Kloeppinger-Todd
   Visa Launches Campaign to Promote             annual survey evaluating trends in              and Manohar Sharma. IFPRI and World
Prepaid Card for Financially Underserved.        microfinance investment. MicroRate. July        Bank. July 2010.
Core to this campaign is Visa’s ability to       2010.
reach consumers who may not realize they
  ACCESSFINANCE | SEPTEMBER 2010 | ISSUE No. 33                                                                                      PAGE 15

Inclusive Financial Systems                       Agriculture and Rural Development (ARD)             Savings of the Poor: How They Do It.
(continued from page 14)                          Discussion Paper 48. May 2010.                   This book portrays the concepts of savings
                                                     The Age of Productivity: Transforming         behavior of the poor, various inclusive
   Why Microfinance Take-Up Rates Are                                                              approaches and insights into the
                                                  Economies from the Bottom-Up. This
Low and Why It Matters.           Actively                                                         regulatory mechanisms in India. This
                                                  book describes that productivity, the main
studying take-up rates, or participation                                                           book has captured the wide literature on
                                                  driver of economic prosperity, is
rates, can help us understand the demand                                                           the behavior of poor towards savings and
                                                  languishing in Latin America and the
for different microfinance products and                                                            distilled the key lessons for the
                                                  Caribbean and is preventing the region
how existing products might be improved                                                            practitioners and policy makers. Linking
                                                  from catching up with the developed
to attract more clients and serve them                                                             products to purpose, catering to multiple
                                                  world. Asking why the region is falling
better. This note reviews the evidence on                                                          needs, focus on short-term savings,
                                                  farther and farther behind, this book looks
take-up. It first discusses why take-up                                                            priority to convenience, appropriate
                                                  beyond the traditional macro explanations
rates and participation are important, and                                                         incentive design, saving in kind and
                                                  and digs all the way down to the industry
how they can be measured. It then reviews                                                          building trust are the key learnings
                                                  and firm level to uncover the causes of
survey data on why people don’t use                                                                highlighted in this book. By Sankar Datta,
                                                  this low productivity. It argues that Latin
microfinance products when they are                                                                S L Narayana and S Srinivas. The
                                                  America has inadvertently invested far too
available and offers guidance on how low                                                           Livelihood School & BASIX. 2010.
                                                  much of its scarce resources into far too
take-up rates might be addressed. By
                                                  many microenterprises, and not enough
Dean Karlan, Jonathan Morduch, Sendhil                                                             UPCOMING EVENTS
                                                  SMEs. That is, the continent is
Mullainathan. Financial Access Initiative.                                                            Microfinance India Summit: Mission of
                                                  increasingly recycling its scarce resources
June 2010.                                                                                         Microfinance – Need to Reflect and
                                                  into          hugely          unproductive
   Banking Services for the Poor:                 microenterprises and so away from small          Reaffirm.        Organized by ACCESS
Managing for Financial Success. Today             and medium enterprises with a much               Development Services, the annual
more than ever it is evident that financial       higher possibility of generating the             Microfinance       India   Summit       has
organizations that fail to heed the               productivity growth that we know lies            established itself as an international
principles of sound financial management          behind sustainable poverty reduction and         conference       dedicated   to     Indian
will rapidly find themselves in trouble.          economic growth into the longer term. By         microfinance. The Summit sessions will
This book is designed to offer practical          Carmen Pages-Serra. Inter-American               focus on current trends and issues relating
and clear applications of traditional             Development Bank. April 2010.                    to sustainability, transparency, social
financial    topics    to     microfinance                                                         performance, commercialization of the
                                                     Pro-Poor Financial Services for Rural
Institutions and all important for the                                                             sector, client protection.
                                                  Water: Linking the Water Sector to Rural
donors, consultants and regulators who                                                               November 15 – 16, 2010. New Delhi,
                                                  Finance. This report shows that despite
work regularly with microfinance                                                                   India.
                                                  the fact that the financial services sector in
institutions. By Robert Peck Christen.
                                                  many countries, particularly in sub-                Developing       Inclusive     Financial
Accion International. June 2010.
                                                  Saharan Africa, are still characterized by       Systems: CGAP Course for Funders of
   Rural Banking: The Case of Rural and           manifold constraints and limitations, the        Microfinance. The course delivers a full
Community Banks in Ghana. . This case             future potential of local financial markets      curriculum that equips participants with a
study describes the history and business          for financing rural water is very                solid grounding in microfinance and the
model of the rural and community bank             significant. The potential for increased         tools to make sound financing decisions.
(RCB) network in Ghana, analyzes its              involvement of local financial markets in        At the heart of the teaching methodology
performance, identifies key issues, and           the pro-poor water and sanitation sector         are case studies and group work that are
makes recommendations on the way                  is within reach. Successful approaches will      built on real‐life situations, allowing
forward. The study analyzes the service           require a general effort in particular by        participants to learn in a creative and
delivery and financial performance of the         policy makers to develop financial systems       interactive method. The course involves a
RCBs at two levels: the network of all            in sub-Saharan countries, which would            site visit to MFIs in the country of
banks and a representative sample of 12           benefit from pro-poor rural financial            instruction. Participants attending the full
RCBs. It finds that although the service          services. By Dr. Franz-Josef Batz (GTZ),         course (five days) will benefit from
delivery performance of the RCB network           Stephanie Lorek (GTZ), Johannes                  carefully sequenced sessions that lead up
has been very good, its financial                 Majewski (GTZ), Christoph Lassenberger           to practical application of good practice
performance has been mixed. By Ajai Nair          (IFAD). GTZ, IFAD and the ARD Rural              principles. Those staying for the short
and Azeb Fissha. World Bank and                   Finance Team. March 2010.
   ACCESSFINANCE | SEPTEMBER 2010 | ISSUE No. 33                                                                                    PAGE 16


Inclusive Financial Systems                        discussed include: What is the impact of          Inclusive Finance: A Path to MDGs.
(continued from page 15)                           microfinance on the poor?; How to              Financial inclusion event launching the
                                                   increase savings behavior among the            BRIDGE initiative, Building Remittance
course (three days) will receive a thorough
                                                   poor? How do interest rates affect the         Investment for Development, Growth,
overview of the fundamentals of
                                                   demand for microfinance products?; How         and Entrepreneurship, and promoting
microfinance. November 8 – 12, 2010.
                                                   to    design    appropriate    consumer        financial inclusion as a contributor to
Nairobi, Kenya.
                                                   regulation?; Does business training help       MDGs. September 22, 2010. New York
   MicroFinancial Services World – 2ND                                                            City.
                                                   microenterprises?; Microinsurance -
Annual USA Meeting: “Innovation in
                                                   impact and product design. FAI, IPA, J-           Global Partnerships in Microfinance,
Microfinance” . MicroFinancial Services
                                                   PAL, Moody’s Corporation, Deutsche Bank        International Conference. The University
World conference including training
                                                   and CGAP. October 21-23, 2010. New             of Greenwich, in collaboration with the
workshops is targeted at investors and
                                                   York City.                                     University of Birmingham and Burgundy
practitioners in the microfinance and
                                                      Financial Inclusion: Achieving Asia’s       School of Business, is holding an
broader financial inclusion space. The
                                                   Potential. The forum will bring together       international conference on Global
conference enables industry leaders to
                                                   leading     microfinance      practitioners,   Partnerships in Microfinance. The theme
identify the next generation of investors in
                                                   policymakers, financiers, academics and        of the conference responds to the
microfinance, provides information on
                                                   advocates as partners in achieving greater     imperative need of microfinance to help
emerging       products      within     the
                                                   financial inclusion in Asia. October 12-15,    alleviate poverty in a sustainable fashion.
microfinance portfolio highlighting their
                                                   2010. Colombo, Sri Lanka.                      Center website, call for papers, and
investment potential and evaluating their
                                                      C5's 4th Annual Microfinance Summit.        conference registration. September 6-7,
delivery potential for the bottom of the
                                                   C5's Microfinance summit offers a forum        2010. University of Greenwich, London,
pyramid and a full update on the progress
                                                   for all participants in microfinance to        UK.
of social performance indicators. Over 50
industry leaders worldwide are presenting          meet, network, and participate in                 16th     Annual      Boulder      MFT.
at the conference. October 25-28, 2010.            discussions about the state and future of      Participants and world-renowned faculty
Washington, D.C.                                   microfinance.                                  are brought together to discuss and
                                                      The 4th Microfinance Investment             analyze issues surrounding Microfinance.
   Business Planning and Financial
                                                   Summit affords an opportunity to               Throughout the three weeks of intensive
Projections with Microfin. This course
                                                   establish a fresh network of industry          technical immersion, participants will be
guides participants through a step-by-step
                                                   contacts    and    strengthen  existing        able to challenge paradigms and bring
process for developing a business plan and
                                                   partnerships. Participants come from           themselves up-to-date in areas such as
financial projections for a microfinance
                                                   more than 40 countries. October 6-7,           management, risk, financial analysis, and
institution using Microfin 4.0, the
                                                   2010. London, U.K.                             social performance. The program offers
sophisticated       financial    projections
                                                                                                  over 45 courses to choose from which
software that was developed by the
                                                   PAST EVENTS                                    allows participants to follow a particular
facilitators of this training course, Chuck
                                                      Alliance for Financial Inclusion (AFI)      topic concentration or create their own
Waterfield and Tony Sheldon, with
                                                   Annual Global Policy Forum: Taking             unique and cohesive training experience
financial support from CGAP, Women's
                                                   Financial Inclusion to the Next Level. The     based on the specific needs of their
World Banking, and Sida. October 25-29,
                                                   2010 Global Policy Forum is a unique           organization,    role    and     interests.
2010. Washington, D.C.
                                                   opportunity to review and assess progress      Participants will complete 96 course
   Microfinance Impact and Innovation                                                             hours. July 19–August 6, 2010. Turin,
                                                   on financial inclusion policymaking of the
Conference 2010. The Microfinance                                                                 Italy.
                                                   last 12 months, take stock of key activities
Impact and Innovation Conference is a
                                                   that have taken place within the AFI
unique forum for both communication of                                                            NEWSLETTERS
                                                   network and share the lessons learned.
accumulated knowledge as well as the                                                                 EMN         Newsletter.       European
                                                   The Forum identified gaps and challenges
generation of innovations in both                                                                 Microfinance Network (EMN) produces a
                                                   to address bottlenecks and further
microfinance product design and                                                                   quarterly e-newsletter that contains the
                                                   advance financial inclusion policy in
research. Sessions will touch on topics                                                           latest news on the sector and information
                                                   developing countries and set the stage for
including microcredit, interest rates,                                                            on EMN activities and events, policy
                                                   defining priority areas for AFI’s work
microsavings and business training,                                                               developments, member news and profiles
                                                   program for 2010-2011. September 27-29,
among others, framed by questions of                                                              and feature articles on topics relevant to
                                                   2010. Bali, Indonesia.
product design, marketing, usage and                                                              microfinance.
impact. Questions and issues to be
  ACCESSFINANCE | SEPTEMBER 2010 | ISSUE No. 33                                                                                    PAGE 17


Inclusive Financial Systems                          ACCION. ACCION International is a              European     Microfinance   Network
(continued from page 16)                          private, nonprofit organization with the       (EMN). The EMN supports the
                                                  mission of giving people the financial         development        of      microfinance
   InSight Bulletin. As short, frequent,
                                                  tools they need, such as microenterprise       organisations through the dissemination
one-topic bulletins, the ACCION InSight
                                                  loans, business training and other             of good practices and by improving the
series highlights ACCION's policy
                                                  financial services – to work their way out     regulatory frameworks for microfinance
viewpoints and ongoing research in the
                                                  of poverty.                                    and     self-employment    and    micro
microfinance field.
                                                     AFI – Alliance for Financial Inclusion.     enterprises at the European Union and
   INSME news. IN Small and Medium                                                               Member State levels.
                                                  AFI is a knowledge network of central
Enterprises news is a monthly newsletter
                                                  banks and other financial regulatory              Finance and Private Sector Research.
by the INSME Secretariat about its
                                                  bodies in developing countries. Through        The World Bank Finance and Private
current activities and issues related to
                                                  the AFI network, developing country            Sector research has been brought together
innovation and technology transfer for
                                                  policymakers share their knowledge and         in one team. This reflects the centrality of
SMEs.
                                                  experience with financial inclusion            finance to private sector development and
   Microfinance Capital Markets Update.           policies that are proven to work.              vice versa and the fact that large parts of
Is produced and edited by CGAP and the                                                           both sub-disciplines revolve around the
                                                     IPA - Innovations for Poverty Action.
Microfinance Information eXchange (the                                                           behavior and performance of firms. This
                                                  Develop innovative solutions to poverty
MIX), and it is dedicated to microfinance                                                        website is maintained by the World
                                                  and     policy    problems   worldwide.
capital markets news.                                                                            Bank’s Development Research Group.
                                                  Disseminate     results  of   successful
  Microcredit     Summit       Campaign           evaluations to development practitioners          Finscope. A FinMark Trust initiative is
Countdown 2005. A newsletter on                   and policymakers.                              the most comprehensive national
microcredit best practices issued by the                                                         household survey focused on the financial
                                                     International Finance Corporation –
Microcredit Summit Campaign.                                                                     services needs and usage across the entire
                                                  SME. This site provides an overview of
  Microinsurance Focus. MicroInsurance            how IFC supports SMEs through                  South and Southern African population.
Focus is managed by the CGAP Working              investments     and     advisory   work.          Global Development Research Center.
Group on Microinsurance.                          Promoting the growth of SMEs in                Virtual Library on Microcredit. Articles
  MicroLINKS Connections. A monthly               developing countries is an important part      and links to the principle organizations
publication by USAID. This newsletter is          of IFC’s private sector development            active in the field of microfinance.
up-to-date     information      on     the        mission.                                         Micro-Credit Ratings International Ltd
microenterprise work USAID Missions                  CGAP. Building Financial Systems for        (M-CRIL). M-CRIL produces ratings of
and partners are doing across the world.          the Poor. CGAP is a consortium of 28           microfinance institutions in Asia.
   The MicroBanking Bulletin.        MIX          public and private development agencies           Microfinance Gateway. Information for
Benchmarking        source     for    the         working together to expand access to           and about the microfinance industry,
microfinance industry used by investors,          financial services for the poor in             including research and publications,
donors and other service providers to             developing countries.                          specialized resource centers, organization
facilitate greater standardization and a             SmartAid for Microfinance Index             and consultant profiles, and the latest
better understanding of the development           helps funders assess the systems they use      news, events and job opportunities in
of the microfinance sector.                       to support the design, implementation          microfinance.
   Women’s World Banking. E-newsletter            and monitoring of microfinance funding.           MicroSave. This website offers practical
produced by The Women's World                     The tool offers an independent review of       guidance in the form of research papers,
Banking focusing on its publications,             participating funders’ strengths and           briefing notes, training toolkits and other
awards and events.                                weaknesses in five critical areas: strategic   resources on market-led microfinance.
                                                  clarity, staff capacity, accountability for
                                                                                                    Planet Finance. The mission of Planet
LINKS                                             results, knowledge management and
                                                                                                 Finance is to support microfinance
   Financial Access Initiative. The               appropriate instruments.
                                                                                                 programs in countries with operations of
Financial Access Initiative is a consortium          Development Gateway. This site              Planet Finance.
of leading development economists                 includes resources on the provision of
focused on substantially expanding access                                                           Rural Finance Learning Centre. This is
                                                  financial services to entrepreneurs and
to quality financial services for low-                                                           a website dedicated to providing access to
                                                  micro business in developing countries.
income individuals.                                                                              the best materials for capacity building in
                                                                                                 the field of rural finance.
  ACCESSFINANCE | SEPTEMBER 2010 | ISSUE No. 33                                                                                 19
                                                                                                                           PAGE 18


Inclusive Financial Systems
(continued from page 17)

   The     Microfinance    Information              The Rating Fund. The Microfinance       World Council of Credit Unions.
eXchange (MIX). The MIX aims to                   Rating and Assessment Fund. This        WOCCU is a representative organization
promote information exchange in the               website is maintained by The Inter-     and a platform for knowledge exchange
microfinance industry. The MIX Market             American Development Bank (IDB), The    and development for credit unions
strives to facilitate exchange and                Consultative Group to Assist the Poor   worldwide.
investment flows, promote transparency            (CGAP) and The European Union.             Women's World Banking. The WWB
and improve reporting standards in the               The SEEP Network. The Small          network aims to create the possibility for a
microfinance industry.                            Enterprise Education and Promotion      low income woman to build her business
                                                  Network provides access to recent       and assets, improve her living conditions,
                                                  documents, programs and working         keep her family well-fed and healthy,
                                                  groups.                                 educate her children, develop respect at
                                                                                          home and in her community and secure a
                                                                                          political voice.

				
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