Table of Contents
Acknowledgments ix
Abbreviations xi
Chapter 1 Introduction 1
Current Constraints in the Microfinance Industry 2
The Proposed New Microfinance Paradigm 4
Approach to and Methodology behind the Study on Development of a Centralized ICT Platform 5
Recommendations of the Study 6
Note 8
Chapter 2 Bangladesh Microfinance Market Overview 9
Country Overview: Bangladesh 9
Microfinance Sector Overview 12
Microfinance Industry Regulators 14
Apex Funding Institution 15
Microfinance Market Size and Major Players 18
Microfinance Networks 22
Formal Financial Sector 24
Remittances 26
Credit Bureaus 27
Microfinance Products and Services 27
Regulatory Regime 31
Market Potential for Growth 31
Market Outreach 33
Other Market Considerations 33
Market Challenges 34
Notes 35
Chapter 3 The Proposed Centralized ICT Platform 37
The Role of ICT in Meeting Bangladesh's Microfinance Market Challenges 37
Microfinance Technology: The Traditional Way 40
Centralized ICT Platform: The New Paradigm 44
How to Develop a Centralized ICT Platform 52
Chapter 4 Emerging International Practices 55
New Innovations 55
Case Studies: Centralized Platforms for Microfinance 57
Other Efforts Under Way 66
Chapter 5 Creating an Enabling Environment: Policy and Regulations 67
Enabling Microfinance Regulations 68
Enabling Financial Sector Regulations and Applications 69
Enabling ICT and Electronic Data Regulations 74
Going Forward 78
Notes 80
Chapter 6 Technology Design 81
Models of Technology Deployment 82
The Building Blocks 83
Basic Capabilities 86
Catering to Multiple Users 87
Adapting to Individual Needs 88
Connecting to the Platform 89
Chapter 7 Institutional Design 93
Institutional Purpose and Principles 93
Institutional Approaches 95
Analysis of Potential Approaches 98
Recommended Approach 101
Organizational Model 101
Note 103
Chapter 8 Cost Projections 105
The Methodology 106
The Assumptions 107
The Cost 108
Sensitivity Analysis 109
Chapter 9 Conclusions and Recommendations 113
Conclusions 113
Specific Recommendations 115
Appendix Costing Tables 117
Works Cited and Other Resources 121
Index 125
Figures
2.1 Interest Rates 11
2.2 Cumulative Microfinance Loan Disbursements, December 2006 13
2.3 Bangladesh Microfinance Players 14
2.4 Active Borrowers by MFI Class 19
2.5 Growth in PKSF's Microenterprise Loan Portfolio 32
3.1 Technology Use within MFIs and the Microfinance Industry 41
3.2 Role of a Centralized ICT Platform 46
3.3 Use of Technology by MFIs to Provide New Products 49
3.4 Technology Use to Overcome Overlap 50
3.5 Technology and Provision of Safety Nets 50
3.6 Technology and Provision of Accurate Online Data 51
3.7 Integration of the Financial Sector 51
