Business plan guidelines for microfinance institutions

Elwin Groenevelt, the General Director of Qredits stated that: From the outset in it has been our goal to build a reputable and sustainable microfinance organisation filling the market gap left by the changes in traditional lending. We are grateful also for the guarantees and programmes made available through the European Commission in support of this sector and feel it is only fair to have to meet the requirements of the Code in order to continue benefitting from these programmes. Receiving this certificate of compliance with the Code shows how much we have achieved over the past eight years and underlines the fact that Qredits is a best practice example in the European microfinance market.

Business plan guidelines for microfinance institutions

Saturday, 30 April " How to start a Micro finance bank in Nigeria Have you wondered how to start a MicroFinance bank in Nigeria or haven't grasped the total importance of the impact of Microfinance banks on Nigeria's economy?

If so this article is for you. After reading this,you will have all your answers about the roles of Microfinance banks in Nigeria. Mega Banking is for the rich and probably middle class, but Microfinance banks serve the poor. This article describes how you can establish your own Microfinance bank and profit from it.

business plan guidelines for microfinance institutions

Preamble Businesses for which there are ready markets provide the owners quick return on their investments and are more likely to generate profits for a longer time than those whose buyers are not readily available.

With a ready market of over 70 million people, businesses that serve the poor remain veritable channels of investment in Nigeria. One of such is the microfinance bank.

There are marked differences in the modes of operations of a universal bank and a microfinance bank. The regulations and supervision of microfinance banks in Nigeria rest with the CBN, through its development finance office and other financial institution departments.

The customer client of a microfinance bank are predominantly the active poor, with any or combination of the following characteristics as explained by the CBN: The person has a monthly income of not more than twice the monthly per capita income of Nigeria, or minimum wage; he has a total productive asset of not more than N,; he has a meagre means of sustenance or livelihood and has a total annual income that is less than the minimum taxable limit set out in the law relating to income tax.

So, microfinance is all about providing services to the active poor.

Format of good business plan:

How to start Any individual or group wishing to invest in microfinance bank requires a minimum deposit of N20 million for a unit microfinance bank or N 1 billion for a state microfinance bank with the CBN as share capital. A unit microfinance bank has the authority to operate within the local governments in the particular state of its jurisdiction, while a state microfinance bank can spread its tentacles to other states within the federation.

It is a sort of commitment which the CBN needs from the proposed investors. Having earmarked the fund, the licensing requirements, as provided by the CBN, are followed to the letter.

A microfinance expert, Mr. Bolaji Oladele, observed that many businesses had failed because the owners did not put all necessary things into consideration. The same view was expressed by Akinyemi who harped on the business plan.

He said that after arriving at a suitable name for the proposed bank, the next thing to do was the business plan. But according to him, consultants were normally contacted, who utilised their vast experience in preparing the plan.

The price charged by the consultants, he said, is a function of the working capital, adding that a unit microfinance bank with a working capital of about N25 million would be charged between N, and N, The business plan would contain details of the projections and plans, based on the geographical area, market, population, expansion and others.

All the documents are remitted to the CBN, which considers them and grants an approval-in-principle. This is attached to the application that is then filed to the Corporate Affairs Commission CAC for registration as a limited organisation.

Then, the recruitment stage comes in. Here, capable individuals are employed to carry out the business. Oladele advised that preference be given to field officers in the recruitment plan.

The registration certificate from the CAC allows the business to commence while the final licence from the apex bank is being awaited. So, the bottom line is patience.• Through the issue of Small Finance Bank license, RBI wishes to further its goal of broader financial inclusion • Applicants for Small Finance Bank licenses will be required to forward their business plan .

business plan guidelines for microfinance institutions

This paper examines the impact of microfinance on economic growth in Nigeria. Emphasis is made on the micro finance institutions. Some existing NGO microfinance institutions were transformed and business plan in order to access sums of money.

SOCIAL PERFORMANCE MANAGEMENT IN MICROFINANCE Social performance management in microfinance:Guidelines Imp-Act Programme First published by the Institute of Development Studies in performance story in microfinance. Most microfinance institutions (MFIs). While institutions participating in the area of microfinance most often provide lending (microloans can range from as small as $ to as large as $25,), many banks offer additional services.

A Framework for Regulating Microfinance Institutions Hennie van Greuning Joselito Gallardo for an MFI to satisfy external or mandatory regulatory guidelines. As financial institutions, it is prudent defining characteristics of the microfinance business and the varied range of MFIs involved in it.

8. A second example is the initiative by.

Nigeria Microfinance

Corporate Governance in Microfinance Institutions Consensus Statement of the Council of Microfinance Equity Funds Endorsement of the CMEF Governance Guidelines.. 2 Council of Microfinance Equity Funds. Governance • Lack of guidance tailored specifically for microfinance institutions (MFIs).

A list of Microfinance Institutions in Kenya