The Asian Development Bank will fund banking services in Vanuatu

Vanatau belongs to the poorest countries of the pacific areas. Many people are out of reach of modern and secure banking services in the rural areas of Vanuatu. Some people that are employed by the government must make long trips to the nearest branch of the National Bank of Vanuatu (NBV) to deposit their salary in the bank. Some farmers are even hiding their money by burying it in the ground rather than going the long way to the bank and collect their money. Only 13% of the people in the rural areas have bank account and access to financial services. It is estimated that about 92,000 people need financial services.

The Asian Development Bank (ADB) is now supporting the development of banking services that will make it able for the people to use electronic banking and smartcard technology. The new electronic banking system will provide local access to secure and convenient banking services. The Asian Development Bank (ADB) will manage $600,000 in technical assistance, provided by the Japan Special Fund. The National Bank of Vanuatu will support with $150,000 more to complete the funding.

With this new technical support they can provide i wide range of modern banking services which will satisfy the clients financial needs. If it comes out good it can be a model to develop the financial services throughout the Pacific. When everything is up and running the National Bank of Vanuatu can start with microfinance products such as microcredit for example.

Local stores and bank agents will be supplied with the technology and equipment and the clients can open saving accounts with modern facilities, this is how the business model will work.

S&P and IDB are setting up global rating system for MFIs in Latin America

The Inter-American Development Bank(IDB) sponsors a new pilot rating program in Latin America set up by S&P to improve the infrastructure of microfinance institutions for national capital markets. S&P and IDB are cooperating in this project with the aim to gain acccess to the capital markets for the MFIs.

Standard&Poors involvement is a breakthrough in the microfinance industry, S&P talks the same “language” as investor and their benchmarking tools really opens up the capital markets for microfinance institutions.

The Microfinance Rating Methodology Working Group was put together in January 2007 consisting of analysts from S&P and experts in microfinance industry. They work together to find the information investors needs, how MFIs works and the state of the microfinance sector. The information from “The Microfinance Rating Methodology Working Group” are used by Standard&Poors when forming the outlines of the rating methodology and a tailored ranking system for MFIs

Earlier sufficient access to the mainstream capital markets wasn´t enough and made it hard for MFIs to find allocate fundings, because they where treated with mainstream metrics when being analyzed. The ongoing creation of new MFIs and adepting skills in handling funds will require far more easier access to the capital market.