Open Days 2007

Micro-credits for Regional and Local Development

Brussels, 10 October 2007

% of low income householdsw/bank accounts

Georgia – 1%Azerbaijan – 16%Ukraine - 17%Romania – 22%Poland – 67%

Poland microcredit demand study:

• 2 mln potential clients• 14% existing micro-ent• 86% potential ent

There are 65 mln low income households and entrepreneurs in ECA.

Less than 5% has access to financial services

Avg. MFI’s penetration rate: 3%

Financial exclusion is high and the demand for microfinance significant

Average non-bank MFI in Eastern Europe

Gross loan portfolio: US$ 12 million

Active borrowers: 6,400

Depth of outreach: 83%

Female clients: 49%

Rural borrowers: 50%

Sustainability: 127%

PAR>30 days: 4%

Funding structure

5%

36%

10%

16%

29%

4%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%other

commercial loans

concessional loans

earnings

grants

owner equity

Current Constraints and Gapsfor the development of non-bank financing

Enabling environment

tranformation options interest rate regulation tax codes non-profit status definition barriers to MFI borrowing

Funding Growing demand for commercial funding

Current Constraints and Gapsfor the development of non-bank financing

Infrastructure access to credit bureaus limited or non-

existant weak country level associations limited specialised consulting support

Market coverage gaps limited scale and depth of ourtreach, urban bias (unless targeted to serve rural

areas)

Current Constraints and Gapsfor the development of non-bank financing

Products and services current operations are for credit only Limited products for start-ups

Institutional gaps strategic planning limited in scope weak governance systems cost accounting and treasury functions missing HR functions underdeveloped Systems for managing social performance not

in place

Action Research

Policy Work

Sector monitoring and analysis

Training and Consulting

Other MFIs

Donors

Investors

Policy makers

107 member institutions in 26 countries across Central & Eastern Europe, Caucasus, Central Asia and Russia

Networks’ role in promoting inclusive finance: example Microfinance Centre (MFC) for Central and Eastern Europe and the New Independent

States Member

MFIs

Regional Networking & Information Exchange

Support to Country Networks

Market studies