National Microfinance Study of Sri Lanka: Survey of Practices and ...

Table 25 Value of Loans Disbursed by the RDBs During 2000:
Sector
Volume
(SLRs Million)
Percentage
of Total
Agriculture 408 10.1
Animal Husbandry 46 1.1
Fisheries 26 0.6
Small Industry 294 7.3
Construction,
Electrification & Water
165 4.1
Projects/Commerce 446 11.0
Other 2,658 65.7
Total 4,043 100.0
Source: CBSL 2001
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The re-structuring of the Rural Development Banks and the creation of six
separate Regional Development Banks has proved to be correct and now with
autonomous management and with newly competitively recruited General
Managers, the Banks are showing reasonable profits and dividends.
This experiment itself shows that microfinance can be profitable. However the restructuring
process can go further and at least fifty percent of the shares sold to
the private sector at the same time bringing in private sector expertise to the
Board.
The current situation of only staff members of Banks and government bodies or
nominees been the only ones in the Board is not satisfactory and the bank staff
need greater capacity building in social mobilisation as well as training in
standards of microfinance good and best practice.
The lessons from Small Farmers Landless Project where the banks were linked
with SEEDS that did social mobilisation should be introduced, with the bank
entering the wholesaling of credit to NGO’s who have reached acceptable
standards of performance to broaden the outreach and client base.
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