Financial Sector Development in Africa: Opportunities ... - World Bank

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140 Walley Box 4.5 Rwanda Land Reform Program Rwanda has achieved what few other countries in Africa have been able to achieve: it has a working one-stop shop for land transactions and titling. Its success is in part the result of its small size, but also in part the result of a singular approach that has effectively moved away from customary land rights. Property rights are clear, and past claims respected. The country has created a modernized system for administering these rights and claims. Importantly, there is also a functioning dispute resolution mechanism that covers boundary or claim issues. It is estimated that there are 9 million plots of land in Rwanda; all of these have now been mapped and a systematic registration program is under way. This clarity can open up the possibility of land being used as collateral for small rural loans and to expand financial access. Source: Sagashya and English 2009. Land Reform for Modern Efficient Property Rights Land issues have loomed large during much of Sub-Saharan Africa’s postcolonial period. Many of the difficulties are inherited from the colonial systems that were imposed. Many countries now have a blend of colonial laws, customary laws, and sometimes even laws from other countries such as India mixed in with other forms of tenure and legislation. Even where legal certainty does exist, the multiplicity of forms of land ownership and tenure can itself cause operational problems, as each type of land is recorded in a different register and it becomes a complex exercise to check for encumbrances on a property when registering a lien. Land is often seen as an untouchable political subject, but without reform and a move toward a modern system, collateralized lending not only for households but also businesses will be difficult, if not impossible. However, some countries such as Rwanda (see box 4.5) have managed remarkable progress and created efficient functioning systems. The recommendations therefore are to: • Adopt a clear policy framework for land reform and regularization of existing land rights. • Introduce an adequate and fair compensation methodology for cases where property claims and tenure claims may compete.
Housing Finance 141 • Introduce a clear, efficient, and transparent dispute resolution mechanism that is accessible at minimal cost, but is also one that does not allow prolonged and repeated appeals to be used as a delaying tactic. • Introduce a modern computerized title system, which to the extent possible minimizes opportunities for fraud. • In creating a cadastral system, opt for an operational system on general boundary principles rather than the perfect mapping system with new plans drawn for all properties and lots. This ensures rapid processing and mapping of regions. It is important to have a boundary dispute resolution mechanism through which any contested boundaries can be quickly resolved and clarified. • Where possible, unify the land registry, the immovable property registry, and the mortgage register. Creating a one-stop shop is more efficient and eliminates the possibilities for fraud and operational problems. Affordable Housing The preceding discussion has focused largely on mortgage lending and the role it can play in fomenting financial sector development. As has also been shown, mortgage lending will not resolve the housing gap for the vast majority of the population. Other targeted, innovative solutions are needed. A number of alternatives are considered below, including rental market, housing microfinance, public housing, and construction finance solutions. Affordable housing encompasses a wide range of possible solutions that can be found on either the housing supply side or the housing finance (demand) side. On the supply side, it is clear that any efforts to reduce the cost of construction, facilitate access to land, and lower the cost of infrastructure will have a beneficial impact on the price of housing. The first sections of this chapter clearly lay out the size of the coming housing needs; these needs can be met only by leveraging private sector funds. Thus, any steps taken on the housing supply side need to help build the right environment for private developers to come in and deliver affordable housing. The following represent some of the main considerations in addressing housing affordability. • The effective demand for housing must be understood. This can be accomplished by understanding the income distribution in the country and what households in different deciles of the population are able to afford versus what the market can provide in terms of both housing and
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lic Disclosure Authorized Public Di
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Financial Sector Development in Afr
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Contents Foreword Acknowledgments E
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Contents vii PART III Safeguarding
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Contents ix 4.4 Size of Mortgage Lo
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xii Foreword In their own way, each
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xiv Acknowledgments led by Stefan N
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xvi Editors and Contributors of Acc
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xviii Editors and Contributors deve
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xx Abbreviations FSB FSD FSDT FSI G
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2 Beck and Maimbo to the bottom of
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4 Beck and Maimbo advocate a “bui
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CHAPTER 1 Microfinance in Africa Al
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Microfinance in Africa 9 Figure 1.1
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Microfinance in Africa 11 A Special
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Microfinance in Africa 13 Figure 1.
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Microfinance in Africa 15 Impedimen
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Microfinance in Africa 17 Figure 1.
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Microfinance in Africa 19 to physic
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Microfinance in Africa 21 Understan
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Microfinance in Africa 23 Some exam
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Table 1.2 Fanikisha Project Type of
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Microfinance in Africa 27 world reg
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Microfinance in Africa 29 implicitl
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Microfinance in Africa 31 Financial
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Microfinance in Africa 33 situation
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Microfinance in Africa 35 have yet
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Microfinance in Africa 37 9. This i
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Microfinance in Africa 39 Ehrbeck,
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CHAPTER 2 Mobile Financial Services
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Mobile Financial Services in Africa
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Table 2.2 African First- and Second
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Table 2A.1 ID and SIM Registration
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79 Guinea Yes http://fr.allafrica.c
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Togo Yes http://www.mediaf.org/fr/t
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84 Coates and Hofmeister chains. It
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86 Coates and Hofmeister unions in
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88 Coates and Hofmeister trap for t
Page 112 and 113: 90 Coates and Hofmeister Sources of
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Page 116 and 117: 94 Coates and Hofmeister farm input
Page 118 and 119: 96 Coates and Hofmeister Technical
Page 120 and 121: 98 Coates and Hofmeister agree to b
Page 122 and 123: 100 Coates and Hofmeister Box 3.3 C
Page 124 and 125: 102 Coates and Hofmeister Attitudes
Page 126 and 127: 104 Coates and Hofmeister developin
Page 128 and 129: 106 Coates and Hofmeister specifica
Page 130 and 131: 108 Coates and Hofmeister ———
Page 133 and 134: CHAPTER 4 Housing Finance Simon Wal
Page 135 and 136: Housing Finance 113 Figure 4.1 Mort
Page 137 and 138: Housing Finance 115 countries, down
Page 139 and 140: Housing Finance 117 • The housing
Page 141 and 142: Housing Finance 119 limited to a fe
Page 143 and 144: Housing Finance 121 housing and inf
Page 145 and 146: Housing Finance 123 borrowed by ext
Page 147 and 148: Housing Finance 125 Box 4.1 Afforda
Page 149 and 150: Housing Finance 127 Box 4.2 South A
Page 151 and 152: Housing Finance 129 the degree to w
Page 153 and 154: Housing Finance 131 markets is the
Page 155 and 156: Housing Finance 133 are unable to o
Page 157 and 158: Housing Finance 135 greenfield vent
Page 159 and 160: Housing Finance 137 Figure 4.5 Obst
Page 161: Housing Finance 139 changes in the
Page 165 and 166: Housing Finance 143 Box 4.6 Progres
Page 167 and 168: Housing Finance 145 of the impact o
Page 169 and 170: Housing Finance 147 funds. Within s
Page 171: Housing Finance 149 Hassler, O., an
Page 175 and 176: CHAPTER 5 The Reform Agenda for Fin
Page 177 and 178: The Reform Agenda for Financial Reg
Page 199: PART IV Financial Sector Reform: Ac
Page 202 and 203: 180 Dafe lack access to external in
Page 204 and 205: 182 Dafe having a positive theory o
Page 206 and 207: 184 Dafe In sum, high transaction c
Page 208 and 209: 186 Dafe through the selective allo
Page 210 and 211: 188 Dafe institutions of the indust
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190 Dafe the boundaries of informat
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192 Dafe range of examples of both
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194 Table 6.1 Period Since the end
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196 Dafe state-owned financial inst
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198 Dafe The degree of success, in
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200 Dafe Although the current conse
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202 Dafe The interdependence of the
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204 Dafe in the 1980s and 1990s wer
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206 Dafe Alternative Approaches to
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208 Table 6.2 Approach to explain/
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210 Dafe state-centered, and interd
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212 Dafe particularly important fac
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214 Dafe Table 6.3 (continued) Mana
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216 Dafe activism in the developing
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218 Dafe structures can undermine m
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220 Dafe Conclusion There is strong
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222 Dafe policy is not straightforw
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224 Dafe banks that open agents in
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226 Dafe Bankable Frontier Associat
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228 Dafe Goldsheid, R. 1958. “A S
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230 Dafe ———. 2001. Types of
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