Publication: Microfinance as a Regular Commercial Banking Product
Gallardo, Joselito S.
Randhawa, Bikki K.
Sacay, Orlando J.
Hatton National Bank is the largest private commercial bank in Sri Lanka and one of the handful of commercial banks in the world that have initiated microfinance programs. The bank launched its program in 1989 as an integral part of its operations, motivated by two business objectives. First, the program aims to protect the bank s market share from state-owned rural banks and nonbank microfinance institutions such as credit cooperatives, especially in rural and semiurban areas, where more than 75 percent of the country s population lives. Second, the program is an investment in the future: it targets microfinance clients with the potential to grow into small enterprises in the formal sector. This Note profiles Hatton National Bank's microfinance operations, highlighting two questions: How does a privately owned bank downscale part of its operations for microfinance? Is microfinance consistent with profit orientation?
“Gallardo, Joselito S.; Randhawa, Bikki K.; Sacay, Orlando J.. 1997. Microfinance as a Regular Commercial Banking Product. Viewpoint: Public Policy for the Private Sector; Note No. 131. © World Bank, Washington, DC. http://openknowledge.worldbank.org/entities/publication/40a7e36e-5500-5cae-ada5-a58efabb3952 License: CC BY 3.0 IGO.”
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