Date post: | 15-Dec-2014 |
Category: |
Economy & Finance |
Upload: | shree-kumar |
View: | 89 times |
Download: | 0 times |
AEMFI is a network of 31 MFIs established in June 1999
AEMFIs vision is to be a world class innovative network providing value added services in building an inclusive financial system in Ethiopia.
AEMFIs Mission is to enhance the capacity of microfinance institutions and financial cooperatives to deliver financial services to urban and rural households through technical assistance, human capital development, knowledge management, research, networking and advocating and promoting the industry with mutual cooperation from its members, practitioners and key stakeholders.
Transparency Non-political Equity Accountability Member driven Social responsiveness
Help build multifaceted capacity of MFIs in Ethiopia mainly through training;
Study the status, problems, and prospects of existing MFIs in Ethiopia and assess the feasibility of forming new ones;
Help improve the national policy and regulatory environment in favor of the MF industry and its beneficiaries in Ethiopia;
Help MFIs pool loan and equity funds from domestic and foreign sources;
Help formulate and disseminate resolutions and best practices related to the MF industry in Ethiopia
Help appraise and improve the performance of MFIs by serving as the industry’s self-monitoring and database forumFacilitate collaboration, experience-sharing, and information exchange among MFIs in Ethiopia and the rest of the world
Provide MF related information resources for use by policy makers, donors, lenders, continental and international networks, researchers, mf beneficiaries, and the general public
Advocate about the mf industry in Ethiopia through media and publication and
Stimulate exceptional contributions of individuals and organizations to the mf industry by creating an incentive system
Goal 1: Enhance AEMFIs Functional Accountability and Transparency Goal 2: Enhance Efforts towards Achieving the Financial Sustainability
of AEMFI
Goal 3: Ensure AEMFI Generates High Quality Research and Support
Goal 4: Enhance the Capacity and Efficiency of AEMFIs Human Capital
Goal 5: Promote an Inclusive Financial Sector Goal 6: Enhance the Capacity of the Industry
General Assembly
Board of Directors
Executive Director
Training Unit
SACCOs Unit
Research &
Publications Unit
Performance
Monitoring Unit
MIS Unit
Admin Assistant
Accountant
Support Staff
Administration & Finance Unit
Program Management Unit
EIFTRI
Social Performance Unit
Research &
Publications Unit
THE DEVELOPMENT OF MICROFINANCE THE DEVELOPMENT OF MICROFINANCE INSTITUTIONS (MFIS) IN ETHIOPIAINSTITUTIONS (MFIS) IN ETHIOPIA
1. Development of deposit-taking MFIs 2. Growth and outreach 3. Performance of MFIs 4. The role of the government and AEMFI 5. Major achievements 6. Challenges, opportunities and threats 7. Proposed interventions
Credit scheme in Ethiopia started in the late 1980s, as part of NGO relief and
development programs.
Proclamation for licensing and supervision of microfinance businesses in
1996 to separate charity and finance. NGOs are prohibited from delivering
finance
The microfinance Proclamation was revised in 2009 (Proclamation 626 of
2009)
MFIs are allowed by law to mobilize public savings.
31 MFIs registered by the National Bank of Ethiopia
Microfinance is a tool of the government to implement development policies
and programs
DEVELOPMENT OF DEPOSIT TAKING MFIS IN DEVELOPMENT OF DEPOSIT TAKING MFIS IN ETHIOPIAETHIOPIA
Loan productsLoan productsAgricultural loansAgricultural loansMicro and small enterprise loansMicro and small enterprise loansHousing loansHousing loansEquipment leasing loanEquipment leasing loanLoan for trade and other servicesLoan for trade and other servicesConsumption loanConsumption loan
Saving productsSaving productsCompulsory savingCompulsory savingVoluntary saving from membersVoluntary saving from membersVoluntary saving from non-members Voluntary saving from non-members
Insurance productsInsurance productsMoney transferMoney transferOther products such as paying pensioners, collection of taxesOther products such as paying pensioners, collection of taxes
FINANCIAL PRODUCTS OF MFISFINANCIAL PRODUCTS OF MFIS
Outreach: over 2.6Outreach: over 2.6 million million active borrowers active borrowers
(49.8% Women)(49.8% Women)
Outstanding loan balance: Birr Outstanding loan balance: Birr 9.9 billion. 9.9 billion.
(556 million USD) (556 million USD)
Balance of savings: Birr. 6.1 billion (336 Balance of savings: Birr. 6.1 billion (336
million USD) (74% Voluntary Savings)million USD) (74% Voluntary Savings)
Outreach of MFIs as of March 2013Outreach of MFIs as of March 2013
GROWTH OF MFI OUTREACH IN ETHIOPIAGROWTH OF MFI OUTREACH IN ETHIOPIA
IndicatorIndicator Dec, 2003 Dec, 2003 March, 2013March, 2013 % of Growth% of Growth
Active Active borrowersborrowers
755,073755,073 2,609,0602,609,060 345%345%
Loan Loan outstandinoutstandingg
593,978,86593,978,8633
9,998,273,9,998,273,225225
1683%1683%
Saving Saving balancebalance
325,028,67325,028,6700
6,053,312,6,053,312,925925
1862%1862%
OUTSTANDING LOANS & SAVINGS OUTSTANDING LOANS & SAVINGS
( December 2003 – December 2012)( December 2003 – December 2012)
ACTIVE CLIENTS ACTIVE CLIENTS
(December 2003 – December 2010)(December 2003 – December 2010)
FINANCIAL PERFORMANCEFINANCIAL PERFORMANCE
Financial Structure Financial Structure
Financial Performance Financial Performance
Efficiency and Productivity Efficiency and Productivity
Risk and Liquidity Risk and Liquidity
Indicators 2003 2010
1 Return on Assets-5% 1.1%
2 Debt to Equity -8% 2.1%
3 Operational Self-Sufficiency 104% 138%
4 Financial Self-Sufficiency 77% 113%
5Operating Expense/Loan portfolio
20% 10%
6 Cost per Borrower 129 177
7 Borrowers per Loan Officer 383 423
8 Portfolio at Risk > 30 Days 6% 7%
9 Loan Loss ratio 5% 1%
Increase access to finance to 67% Provide financial services to MSE operators
Avail 11 billion Birr of loan to 2.2 million MSE operators Provide financial services to the productive poor in agriculture Provide financial services to chronically food insecure
households Mobilize savings
Transform MFIs from credit-led to saving led institutionsAt least 80% of the loans should be financed from saving mobilization
Regulation (protect solvency of deposit taking MFIs) and creating an enabling policy environment
Providing capacity building support Providing loan capital through RUFIP Direct investment or establishing finance providers owned by
government or government as major shareholder Implementing government programs through MFIs Providing credit guarantee through regional governments Influence interest rate setting and other features of financial
products Tax exemptions Disclosure requirements
Support the creation of an enabling policy and regulatory environment through consultative process
Build the capacity of MFIs and other inclusive finance providersEstablished the Ethiopian Inclusive Finance and Training and Research Institute (EIFTRI)
Create forums to discuss the critical issues of inclusive finance providers
Monitor the financial and social performance management Promote inclusive finance in Ethiopia, including innovations in
the industry Research Knowledge management
Strong focus on the excluded population (farmers and MSE operators) and Strong focus on the excluded population (farmers and MSE operators) and
on productive activitieson productive activities
Increase in outreach Increase in outreach
MFIs have mobilized significant amount of savingsMFIs have mobilized significant amount of savings
Transforming from credit-led to saving-led institutionsTransforming from credit-led to saving-led institutions
Improvements in operational and financial sustainability Improvements in operational and financial sustainability
Transparency of MFIs, efforts to be rated Transparency of MFIs, efforts to be rated
An enabling policy and regulatory environment and strong and positive relationship between regulators and practitioners
Value adding support of the government
Strong network
High unmet demand and lack of loan capital High unmet demand and lack of loan capital Weak MISWeak MISLimited outreach, particularly womenLimited outreach, particularly womenLimited capacity in terms of skilled manpowerLimited capacity in terms of skilled manpowerUneven coverage and penetration of the regions in the country Uneven coverage and penetration of the regions in the country Limited financial products and innovations Limited financial products and innovations Limited opportunities to access foreign capital and inadequate Limited opportunities to access foreign capital and inadequate donor funding donor funding Limited interventions to provide financial services to pastoralistsLimited interventions to provide financial services to pastoralistsLack of solid interventions to promote financial literacyLack of solid interventions to promote financial literacyGovernance problemsGovernance problemsLimited donor supportLimited donor support
Clear legal frameworkClear legal framework
Huge unmet demandHuge unmet demand
Existence of general government supportExistence of general government support
Development of telecommunication and power services in rural areasDevelopment of telecommunication and power services in rural areas
Transformation of MFIsTransformation of MFIs
CompetitionCompetition
Growing interest of banks, postal services, social investors, private sectorGrowing interest of banks, postal services, social investors, private sector
Joining WTO and other regional trade organizationsJoining WTO and other regional trade organizations
Production and marketing risksProduction and marketing risks
Distortions of financial markets by donors, Distortions of financial markets by donors, government, etc programsgovernment, etc programs
InflationInflation
Politicizing microfinancePoliticizing microfinance
HIV/AIDsHIV/AIDs
Over-regulation Over-regulation
Increase outreach by addressing the issue of loan capital
Tailored interventions to increase women clients and other disadvantaged groups
Support of promote back-office and front office technology
Technical support in product development Provide capacity building in terms of training Financial literacy Promote SPM and client protection Establishment of wholesale facilities, without
discouraging savings Provide focused interventions to provide financial
services to access deficit areas, particularly pastoralists27