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Building new development finance institutions instead of remodelling existing ones
MFIs wishing to accept and on-lend savings and thereby expand their operations may consider upgrading to the status of a bank, but are often deterred by the regulations involved. This article presents an alternative approach: creating formal banks for microfinance from scratch. Such Microfinance Banks (MFBs) have been created in Albania, Bosnia, Georgia and Kosovo over the past two years, and they have already reached the point at which they are covering their costs and making profits after only two years in operation. They offer deposit accounts, loans and money transfer services.
MFIs wishing to accept and on-lend savings and thereby expand their operations may consider upgrading to the status of a bank, but are often deterred by the regulations involved. This article presents an alternative approach: creating formal banks for microfinance from scratch. Such Microfinance Banks (MFBs) have been created in Albania, Bosnia, Georgia and Kosovo over the past two years, and they have already reached the point at which they are covering their costs and making profits after only two years in operation. They offer deposit accounts, loans and money transfer services.
The Development of the Financial Sector in Southeast Europe
The Financial Sector and Economic Development: Evidence from Southeast Europe
Mehl, Arnaud
Winkler, Adalbert
2004
https://doi.org/10.1007/978-3-540-24820-0_2 [Citations: 7]Microfinance: Does it Hold its Promises? A Survey of Recent Literature
Khawari, Aliya
(2004)
https://doi.org/10.2139/ssrn.556213 [Citations: 18]Tabs navigation
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