Expanding Microfinance Outreach in Pakistan
This presentation sets out a strategy for upscaling microfinance in Pakistan. It identifies the following challenges that Pakistani microfinance faces:
- Anomalies in the legal, regulatory and taxation framework;
- Complex geographical outreach;
- Difficulties in financial sustainability of microbusinesses;
- Limited alternative delivery channels and inadequate use of technology;
- Lack of experience.
The presentation discusses strategy that Pakistani microfinance sector must adopt to enhance outreach and achieve financial and social sustainability. This includes:
- Commercialization of microfinance industry;
- Infusing competition by allowing multiple and international players;
- Encouraging all-encompassing financial services delivery;
- Launching innovative solutions to product delivery.
Existing organizations have the capacity to reach 3 million borrowers by 2010. In order to achieve this, however, they require sustainable operations, increased private domestics capital and human resource development. More substantive upscaling would require new players, credit union models, technology, introduction of credit bureau for microfinance borrowers, effective and synergistic use of Pakistan Post resources and other policy and regulatory measures.
