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

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Over the past five years SCN has assisted and funded the following organisations: Table 10 Save the Children Norway Microfinance Activity Name of Organisation District Activity Sithuwama Matale Implementing programmes in Ambangaga and Palagala Divisions. PRDA Colombo Implementing programmes in Gampaha, Chilaw and Puttalam. Samadheepa Samaja Kendraya Anuradhapura Implementing programmes in 10 Divisional Secretariats in Anuradhapura. Thadaham Batticaloa Implementing programmes in Valaichenai Division. PTDO Mallavi Implementing programmes in Thunukkai Division. PPDRO Kaluvanchikudi Implementing programmes in Vellavely Division. ESCO Batticaloa Implementing programmes in Valaichenai __________________________ SCN builds fairly long term partnerships over a four years period so as to assist the societies in attaining sustainability. The monitoring and evaluation of the partner organisations and their projects is undertaken by the SCN staff through regular visits, mid term and end term evaluations, with quarterly progress reports required from the partners. United Nations Development Programme There were 2 major projects initiated by UNDP outside of the North and East region that had significant micro-finance components these are: The South Asia Poverty Alleviation Program This was the Sri Lankan component of a South Asian Regional Project managed overall by the Islamabad office, the project started in August, 1995 in Kotmale and Hangurnaketha and expanded to Walpane in March 1997. The project concept focused on poverty alleviation in rural areas through social mobilisation, village society formation and access to microfinance supported by business development services. The project was implemented in Sri Lanka, Nepal, India, Pakistan and Bangladesh. The Sri Lankan component was managed by the Colombo office of UNDP and operated in the Nuwara Eliya District in three divisional areas; Kotmale, Walapena and Hanguranketha, with two project co-ordinators for each division and a overall Project Director. Small groups, village societies and three apex federations at divisional level were formed with the apex federations designed to sustain the networks of societies. 83
As well as the savings given in the table there was also SLR 8.1 million of savings at village society level by end Dec 1999 for utilisation as small loans including those for consumption smoothing. The UNDP provided revolving loan funds for each federation, which were topped up by savings from village societies. The Project came to an end in year 2000 and is now technically supported by the new Catalytic Initiatives for Social & Economic Empowerment of the Poor. This project initiated some ‘ground breaking’ credit plus work with the Federation’s as well as some of the groups supported by the project starting up a number of innovative businesses. However many of these businesses were not started through the use of well thought out business plans and were managed or directed too much by the project staff rather than from the clients. Some of them such as Kitual Treacle making, chocolate slab like jaggery making appeared to be a success. In concept some of these businesses were very good but there was a need for more market development and business management. The prevailing microfinance practices were very weak and the reporting of repayment figures was not undertaken on a regular basis. Civil Society Organisation Project This project used South Asian volunteers to form village societies and higher level federation or apex bodies in six divisions in the border areas of Polonnaruwa and some of the dry zone villages of Matale that suffer from endemic poverty. The target group in five of the six divisions were women and the focus from the beginning was on the higher-level Federation apex development. Very good training was provided for Federation accounting and savings and credit accounting by ICRTL and the period of assistance by UNDP was limited. Each of the six Federations were given a revolving fund of around SLR 2 million by the UNDP as well as limited training in credit plus activities. The project started in 1996 and was completed in March 2000. There is some ongoing technical assistance provided under the new UNDP Programme, ‘Catalytic Initiatives for Social and Economic Empowerment of the Poor”. What was remarkable about this program is that with only three years of donor support divisional level CBOs were formed that are able to function in a sustainable manner without external support. An example of this is the Weligapola Federation that is able to generate a large enough surplus to pay the full time co-ordinator and other part-time workers, it has an excellent set of well prepared accounts that are externally audited. 84
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National Microfinance Study of Sri
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(b) Lenders .......................
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Introduction into the pawning busin
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Microfinance Overview .............
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Savings ...........................
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List of Tables Table 1 Microfinance
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Table 70 Ratnapura District Microfi
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JBIC MFI MFN MIS MPCS MSME NCPPDP N
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Figure 1 Map of per Capita Value of
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Figure 3 Map of per Capita Value of
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Executive Summary This report provi
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Practitioner Microfinance Activity
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As a result the banks are moving aw
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The operating conditions of the con
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Donor Strategies There should be a
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Introduction to the Study The objec
Page 34 and 35: The survey does not claim to repres
Page 36 and 37: Introduction Socio-Economic Overvie
Page 38 and 39: These five years saw a spate of new
Page 40 and 41: The 'Economic Stream' Employment is
Page 42 and 43: Microfinance Clients and Beneficiar
Page 44 and 45: 1. Funders of Microfinance in Sri L
Page 46 and 47: CIDA believes that microfinance act
Page 48 and 49: The Department For International De
Page 50 and 51: NOVIB Partnerships tend to be long
Page 52 and 53: HIVOS The HIVOS Desk concentrates o
Page 54 and 55: Over time SIDA noted that the loan
Page 56 and 57: Comment freely given from one of th
Page 58 and 59: the time period of the project, wit
Page 60 and 61: Only a very small part of the US 50
Page 62 and 63: The demand for loans from this fund
Page 64 and 65: Without permanent access to institu
Page 66 and 67: This broad strategy means that the
Page 68 and 69: Beneficiary targeting was generally
Page 70 and 71: The FCSs were developed the followi
Page 72 and 73: CARE's new strategy commits the org
Page 74 and 75: Each CBO determines the level of in
Page 76 and 77: The project’s overall approach re
Page 78 and 79: Figure 6 GTZ/JRP - Project Interact
Page 80 and 81: The Social Development Foundation F
Page 82 and 83: There are no sector-based quotas ap
Page 86 and 87: UNDP in the North & East - The Jaff
Page 88 and 89: In December 2001 a new UNDP Program
Page 90 and 91: From previous experience and lesson
Page 92 and 93: World Vision Lanka WVL believes tha
Page 94 and 95: Membership Development 3500 3000 25
Page 96 and 97: Table 14 World Vision - Gramashakth
Page 98 and 99: ZOA works with community groups in
Page 100 and 101: At the village society and bank lev
Page 102 and 103: In Wayamba the sustainability of th
Page 104 and 105: Table 15 Badulla IRDP - Summary Dat
Page 106 and 107: DZPDP/WHRDA credit operations comme
Page 108 and 109: In the initial years they did not f
Page 110 and 111: Table 18 SPRDP- Loans 1993 to 1999
Page 112 and 113: (c)Lender-Practitioners The Central
Page 114 and 115: Society members have access to cred
Page 116 and 117: The RDBs were re-structured in 1998
Page 118 and 119: Table 25 Value of Loans Disbursed b
Page 120 and 121: The total savings and credit issued
Page 122 and 123: Table 29 Samurdhi - Loans by Distri
Page 124 and 125: In 1998 SEEDS converted to a separa
Page 126 and 127: Within the loans from SEEDS funds t
Page 128 and 129: The Arthacharya Foundation practice
Page 130 and 131: The program was assisted by some li
Page 132 and 133: However in general the majority of
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Table 33 Growth of MPCS CRBs -1990
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As at the end of December, 2000 a s
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Some 1,176 of the 1,476 Co-operativ
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A total of 74 NGOs were identified
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Finally only a small proportion of
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Table 38 TCCS Active Societies and
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District Unions - National Federati
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4. Facilitators a) National Level F
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International Centre for the Traini
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Funder-Practitioner Microfinance Ac
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As practitioner experience increase
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Introduction and Approach The major
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State-Owned Banks The Bank of Ceylo
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Starting in 1994, the NCRCS is aime
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The Seylan Bank The Seylan Bank ent
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Figure 9 Linking of the RBIP Tools
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People's Fast reduces loan processi
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In addition, RBIP monitors the impl
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The Hatton National Bank Case Study
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Seylan Bank Case Study The Seylan B
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Until 1961 private pawnbrokers were
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Bank officials stated that PSC staf
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The urban PSCs have on average more
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The lack of flexibility has induced
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From the borrowers perspective not
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The Peoples Bank, on the other hand
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Introduction and Approach Internati
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Displaced populations are dependent
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Large tracts of land have become to
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Public markets, shops, guest houses
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The previous thriving local economy
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The Wanni Access to the area known
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Remembering that these intervention
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This type of situation is seen thro
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People IDPs in welfare centres, sho
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World Vision has been working in al
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small entrepreneurs have received t
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The exception to this is a governme
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There has been some continued acces
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Introduction and Approach A distric
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The MPCSs were equally disrupted an
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The main body of the survey is pres
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Local NGOs 11 NGOs were identified
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Local NGOs 1 NGO was identified in
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Local NGOs 1 NGO was identified in
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Local NGOs 2 NGOs were identified i
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Local NGOs No NGOs were identified
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Gampaha District Microfinance Overv
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Hambantota District Microfinance Ov
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Jaffna District Microfinance Overvi
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Staring in 1998 each DS received SL
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Matale District Microfinance Overvi
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Matara District Microfinance Overvi
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Moneragala District Microfinance Ov
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Nuwara Eliya District Microfinance
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Polonnaruwa District Microfinance O
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Puttalam District Microfinance Over
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Ratnapura District Microfinance Ove
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Trincomalee District Microfinance O
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Vavuniya district Microfinance Over
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The Wanni Area Microfinance Overvie
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Summary Microfinance Activity by Ac
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The NGO questionnaire survey identi
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World Vision Lanka works in 5 distr
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Given that these figures do not inc
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Overall, 13 of districts had levels
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Averages Value of Loans Table 78 Av
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Volume and Number of Loans The surv
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Findings The key and main findings
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Service Providers The service provi
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those incapacitated by conflict, wi
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Cultures of Dependency in Microfina
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Strategic Recommendations The key s
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Conclusion The study found that the
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Charitoneko, S. and D de Silva (200
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Remenyi, J (1991). Where Credit is
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Technical Appendix
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