Country microfinance network extensive - Survey
Harshini Perera
Microfinance providers have an extensive network in the country with
over 10,800 outlets and the SANASA Movement has the largest number of
active outlets followed by NGOs, as revealed in a nationwide survey of
microfinance institutions in Sri Lanka. This was published by the
GTZ-ProMis (Promotion of the Microfinance Sector) and the German
Technical Cooperation GmbH in Sri Lanka.
According to the report, traditional microfinance products are
offered by a large number of microfinance Institutions. A broader range
of financial services is offered such as saving, pawning, leasing and
insurance and pension products by microfinance institutions. All
Samurdhi Bank Societies (SBS), Thrift and Credit Cooperative Societies (TCCs),
Cooperative Rural Banks (CRBs), Regional Development Banks (RDBs) and
banks as well as 89 percent of the NGO MFIs and 60 percent of finance
companies offer savings and deposits products.
Microfinance providers covered by the survey have reported a total of
over Rs. 126 billion in volume outstanding of savings and deposits and
over 26 million savings accounts. A large number of microfinance
providers (95 percent of NGOs, 92 percent of CRBs, 86 percent TCCs and
banks, 83 percent of RDBs and 64 percent of SANASA Secondary Unions)
have said they offer complementary non-financial services to their
microfinance clients.
Many microfinance providers focus extensively on savings and do not
fully exploit the resources thus mobilized to extend credit to finance
the income generating activities of their microfinance clients. The
ratio of loans to savings is one to 2.6 in terms of volume outstanding
and one to 5.9 in terms of number of accounts.
According to the report, the microfinance sector in Sri Lanka
consists of a diverse range of institutions which do not fall under the
purview of a single authority and there is currently no single and
up-to-date database on these institutions. The Sri Lankan microfinance
market seems to be to a certain extent conservative, focusing more on
the proliferation of variations of the same traditional products,
lacking innovative approaches which could overcome the inherent barriers
in access to microfinance. |