Malawi's Financial Landscape: Where Does Opportunity International Bank of Malawi Fit?

This paper discusses financial services access in areas of Malawi that will be served by the rural service delivery innovation of Opportunity International Bank of Malawi (OIBM). In the first phase, OIBM will have a mobile bank branch to serve six locations along two major routes. OIBM will provide a wide range of financial services including savings, loans, insurance and payment services, and will target all client segments ranging from the economically-active poor to corporations. Research reveals that:

• Rural locations that OIBM will expand into already have banking services;
• Formal savings are mostly accessed by the well-to-do;
• Loan market is fragmented, with demand outstripping supply;
• Credit is less widely available than savings, but is provided by a wider range of institutions;
•  Financial services uptake is relatively low, but rural residents are aware of financial choices. 

Initial research reveals that there are several areas where OIBM can add value. It can increase physical access to financial services in four locations that are currently unserved or underserved. OIBM is unique in offering the possibility of a one-stop shop for financial services and can target all client segments, particularly the poor.