Publication: Microfinance Handbook: An Institutional and Financial Perspective
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1998-12
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2013-02-15
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The purpose of this handbook is to bring together in a single source guiding principles and tools that will promote sustainable microfinance and create viable institutions. It provides a comprehensive source for the design, implementation, evaluation, and management of microfinance activities. The book has three parts: part one takes a macroeconomic perspective toward general microfinance issues and is primarily non-technical. Part two narrows its focus to the provision of financial intermediation, taking a more technical approach and moving progressively toward more specific (or micro) issues. Part three, the most technical part of the handbook, focuses primarily on assessing the financial viability of microfinance institutions.
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“Ledgerwood, Joanna. 1998. Microfinance Handbook: An Institutional and Financial Perspective. © World Bank. http://hdl.handle.net/10986/12383 License: CC BY 3.0 IGO.”
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Publication Transforming Microfinance Institutions : Providing Full Financial Services to the Poor(Washington, DC: World Bank, 2006)In response to a clear need by low-income people to gain access to the full range of financial services including savings, a growing number of microfinance NGOs are seeking guidelines to transform from credit-focused microfinance organizations to regulated deposit-taking financial intermediaries. In response to this trend, this book presents a practical "how-to" manual for microfinance institutions to develop the capacity to become licensed and regulated to mobilize deposits from the public. This book provides guidelines for regulators to license and regulate microfinance providers, and for transforming microfinance institutions to meet the demands of two major new stakeholders -regulators and shareholders. As such, it focuses on developing the capacity of NGO microfinance institutions to mobilize and intermediate voluntary savings. Drawing from worldwide experience, it outlines how to manage the transformation process and address major strategic and operational issues inherent in transformation including competitive positioning, business planning, accessing capital and shareholders, and how to "transform" the microfinance institutions human resources, financial management, management information systems, internal controls, and branch operations. Case studies then provide examples of developing a new regulatory tier for microfinance, and how a Ugandan NGO transformed to become a licensed financial intermediary.Publication Microfinance Consensus Guidelines : Guiding Principles on Regulation and Supervision of Microfinance(CGAP and World Bank, Washington, DC, 2003-07)Many developing countries and countries with transitional economies are considering whether and how to regulate microfinance. These guiding principles are formulated for the regulation and supervision of microfinance. This document is divided into five sections. The first section of the paper discusses terminology and preliminary issues. The second section outlines areas of regulatory concern that do not call for "prudential" regulation. The next section discusses prudential treatment of microfinance and Microfinance Institutions (MFIs). The fourth section briefly looks at the challenges surrounding supervision, and the final section summarizes some key policy recommendations.Publication Microfinance Institutions and Credit Unions in Albania : Regulatory, Supervisory and Market Development Issues(Washington, DC, 2008-06-17)The objective of this report is to present an assessment of the current legal, regulatory, and supervisory framework in Albania for microfinance, as well as an assessment of institutions rendering microfinance services (MFIs), including the Savings and Credit Associations (SCAs) and credit unions (CUs), to identify future development priorities. Economic conditions have improved in Albania in recent years, but a significant percentage of the population is still considered below the poverty level. The report lists future development priorities for the SCAs and MFIs, emphasizing poverty reduction through microfinancing. Several MFIs, and one CU, expressed some desire to borrow from the World Bank. The report finds this promising, as long as it does not crowd out commercial sources that serve to integrate MFIs, CUs, and SCAs into the larger financial sector. The growth of SCAs might be enhanced by further consolidation of smaller SCAs into larger SCAs. Mergers based on joint objectives and bounds can expand the geographical coverage and clientele base, facilitate the increase of cash flows and access to capital, and achieve economies of scale in view of reducing fixed costs. Albania also wishes to obtain a banking license and focus exclusively on the microfinance market. A tax exemption enables CUs and SCAs to build up capital through retained earnings. Eliminating their tax exemption would either reduce their capital, or require that CUs replace the taxed earnings with other means of capitalization to maintain the same capital reserves. The report recommends that the Bank of Albania (BoA) should continue to work with the CUs on consolidating and strengthening the SCAs.Publication Experiences of Microfinance Institutions Serving Very Small to Small Enterprises in Latin America(Washington, DC, 2014-07)Very small enterprises (VSEs) in Latin America and the Caribbean (LAC) represent a broad and heterogeneous segment, often underserved by formal financial institutions. They are generally informal and often family businesses. The financial needs of these enterprises are typically overlooked by “downscaling” banks, which find larger and often more formal small and medium enterprises (SMEs) to be a more natural market for their products and services. Microfinance Institutions (MFIs) are starting to move upmarket to serve SMEs, and in particular, VSEs within this segment. However, they use varying definitions, methodologies and products to do so and to date there has been little research or documentation of their experiences. This report highlights the results of a recent study of the existing practices in Latin America of MFIs serving VSEs, where VSEs are considered to be those businesses with financing needs of between US$7,000 and US$30,000. It is a starting point for an institution considering entering the segment, or for one that finds itself having grown into the segment “organically” but with a view to strengthen its position. It includes several checklists for MFIs interested in expanding upmarket into the VSE space, as well as more detailed discussions and examples of the most relevant points.Publication A Framework for Regulating Microfinance Institutions : The Experience in Ghana and the Philippines(World Bank, Washington, DC, 2002-01)An earlier Policy Research Working Paper (Hennie van Greuning, Joselito Gallardo, and Bikki Randhawa, "A Framework for Regulating Microfinance Institutions," WPS 2061, February 1999) presented a regulatory framework that identifies thresholds in financial intermediation activities that trigger a requirement for a microfinance institution to satisfy external or mandatory guidelines-a tiered approach to regulation and prudential supervision. The model focuses on risk-taking activities of microfinance institutions that must be managed and prudentially regulated. The author reports on the results of the field testing and assessment of the tiered approach, focusing on the experience of Ghana and the Philippines. The two countries both have a wide range of informal, semi-formal, and formal institutions providing financial services to the poor, but differ in how they regulate financial intermediation activities by microfinance providers. In his assessment and a comparative analysis, the author focuses on key issues in the regulatory and supervisory environment for microfinance-and in the legal system and judicial processes-being addressed by government authorities and microfinance stakeholders in both countries. He gives particular attention to the thresholds at which intermediation activities become subject to prudential regulation and regulatory standards for capitalization and capital adequacy, asset quality and provisioning for nonperforming loans, and liquidity management. seeks to identify the key elements and characteristics of the microfinance regulatory experience of Ghana and the Philippines and to draw the lessons that may be useful for other countries interested in establishing a regulatory environment conducive to the development of sustainable microfinance institutions. The experience of Ghana and the Philippines shows that a transparent, inclusive regulatory framework is indispensable for enabling microfinance institutions to maintain market specialization and to pursue institutional development that leads to sustainability. Clear pathways for institutional transformation facilitate the integration of microfinance institutions into the formal financial system.
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