Annual Report 2010 - Ministry of Finance and Planning

6 | DEVELOPMENT FINANCEBox 6.2Microfinance Meets Regional Demand for InvestmentRegional and Sectoral Distribution of Microfinance OutletsChart 6.4 > Microfinance Outlets by ProvinceChart 6.5 > Microfinance Outlets by SectorNorthern5.20% Eastern12.30%Sabaragamuwa11.20%Western12.20% Central10.10%Urban9.60%Estate1.00%Uva10.80%North Central3.90%North Western10.20%Southern24.00%Rural89.40%Regional and sectoral distribution of Microfinance outletsis shown in figure above based on the MFI survey. Thereis a strong presence of MFIs in the Southern Provincewith nearly a quarter of the outlets located there. NorthCentral province is relatively underserved accountingfor 3.9 percent of the outlets and Northern Provinceaccounts for 5.2 percent of the outlets based on theinformation of the survey.According to the above figure almost 90 percent of theMicrofinance outlets in Sri Lanka are clearly concentratedin rural areas while less than 10 percent of the outlets arelocated in urban areas and only 1 percent in the estatesector. This fact pointed out that there is a vacuum in themicrofinance services in the estate sector.Table 6.5 > Microfinance Loan DisbursementLoan AmountLess than Rs. 2 Mn Rs. 2 Mn - Rs. 5 Mn Rs. 5 Mn - Rs. 10 Mn More than Rs. 10 MnBank of Ceylon 32,149.00 2,601.00 0.00 0.00Peoples Bank 4,601.39 162.90 18.40 119.34RegionalDevelopment Bank4,023.00 0.00 0.00 0.00HNB 7,613.00 2,017.00 1,356.00 1,829.00SANASADevelopment Bank12,256.00 0.00 0.00 0.00Other Banks 572.26 70.85 100.28 671.59Source: All Commercial BanksAccording to the data gathered by the Department ofDevelopment Finance in 2010, State Banks specially Bankof Ceylon and SANASA Development Bank have a particularlyhigh level of loan disbursements of less than Rs.2 million and have disbursed few loans, which are morethan Rs. 2 million. When compared to State banks HNBis more outstanding in microfinance activities and haveoffered significant loans to the microfinance sector in allrange of loan amounts. The microfinance sector need theregulatory framework to be effective in their role.296