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From Tribal Hamlet to Financial Consultancy...

Meera Shenoy's picture

It has been a long journey for Shekar Nalla –from a small tribal village in Andhra Pradesh, India to selling insurance products in the metropolitan city of Hyderabad.

Shekar’s family lived a hand to mouth existence, and he thought that maybe someday in the future he would earn Rs. 24,000 (US$400) per year. But now, Shekar earns Rs. 156,000 (US$3000) annually through his new job with an insurance company.

His widowed mother no longer has to struggle because Shekhar sends her Rs. 60,000 (US$1500) a year. With his new job the status of the family has risen among the village headman and higher caste members, especially when he sent home a colored Samsung TV—the first in his village. “Richer relatives who avoided us, call me saying, ‘Shekar can you show me a job’,” said Shekhar.

The United Nations commemorated the International Year of Youth from August 11, 2010 to August 11, 2011. To promote youth participation towards progress and development, the Rural Livelihoods team at the World Bank has put youth like Shekar Nalla at the forefront of poverty reduction and maximizing rural growth.

Join us to Discuss Bangladesh's Economic Prospects!

Naomi Ahmad's picture

We've launched a two-day online discussion on Bangladesh's Economic Growth at the World Bank Bangladesh Facebook page. Through the online discussion, we hope to initiate dialogue with you on Bangladesh's economy, the possibilities and the binding constraints for its continued growth.

Our economists will answer your questions and moderate the discussion. We encourage you to share your thoughts or ask questions on these pertinent issues and are looking forward to hosting more discussions on different themes.

Join us, leave comments, and invite your friends!

What? Bangladesh's Economic Growth: How can Bangladesh can embark on its journey towards higher growth?

When? August 25 and 26, 2011

Where? World Bank Bangladesh on Facebook

Let us know what you think!

Bravo Bangladesh! Instilling a Culture of Results

Naomi Ahmad's picture

My village is beautiful and I have lived here all my life. Even though life can be hard, I don’t want to go away.” Eight-year-old Zannati lives on the front lines of climate change in her cyclone-ravaged coastal village of Nishanbaria on the Bay of Bengal. When she speaks, you feel her determination and see the fire in her eyes.

The embankment holding back the sea, part of 480 kms of embankment repaired and reconstructed by the World Bank, is the only protection her village has from cyclones.

Shabash Bangladesh (Bravo Bangladesh) – a photo exhibition showcasing development results in Bangladesh – tells the story of Zannati and many other Bangladeshis, serving as a visual backdrop to the first Country Performance and Results Review (CPRR) in Dhaka on April 13, 2011.

The CPRR was the first high-level review to take stock of the results being achieved under the Bank’s FY11-14 Country Assistance Strategy (CAS). This event was part of wider efforts to instill a results culture across the Bangladesh program, from the project level during implementation support, to the portfolio and strategy levels. It was also an important step in enhancing the Bank’s accountability for results.

Will recent events in the Middle East Affect Remittance Flows to South Asia?

Ceren Ozer's picture

For countries with substantial numbers of workers in the Middle East, recent events have not only raised concerns for the repatriation and welfare of their citizens, but have also raised fears of a possible slowdown in remittances. Will remittance flows noticeably decrease due to recent events in Egypt, Libya, and Tunisia?

For South Asian countries, remittances are among the largest and most stable sources of foreign exchange and their developmental impact have been remarkable. For example, in Nepal national poverty level has come down from 42% to 31% during 1996 to 2004, and to 21% today, largely on the account of remittances which finance household consumption as well as education and health expenditures. Nepal, Bangladesh, and Sri Lanka, were among the top 15 remittance recipients in 2009—with inflows being equivalent to 24% of the GDP in Nepal, 12% in Bangladesh, 8% in Sri Lanka, 5% in Pakistan and 4% in India.

Gulf States employ more than 11 million expatriate workers, an estimated 8 million or more from South and East Asian countries. Saudi Arabia, the U.A.E, and Qatar are top destination for South Asian migrants and are main sources of remittance inflows. The table as well as the country profiles below demonstrates the sheer magnitude of migrant workers in the Arab Gulf countries and their contributions to the labor force; sometimes greater in overall numbers and proportion than the respective labor force in the countries.

The Value of Connected Savings

Daniel Radcliffe's picture

The business case for low-balance savings is tough, as the margin on float may not amount to much. In much of South Asia, the economics of savings for the poor has been buttressed by microcredit – the notion that the account anchors the customer relationship and the loan gives it profitability. But financial inclusion premised on credit is always going to leave some people behind: those who do not feel like credit is the right financial tool for them or who simply do not have the ability to commit to future payment streams.

A new vision is emerging around integrating the savings proposition into a broader payments network. Offering “connected savings” accounts rather than stand-alone accounts helps the economics of low-balance savings in three ways:

Budding Economists Showcase Regional Cooperation

Dulanii Liyanahetti's picture

It was a cold evening back in 2004 when a few students and professors of Ramjas College of the University of Delhi got together and initiated an idea that would form the basis for improving regional cooperation among South Asian countries. South Asia has many things in common, and is affected by diverse sets of issues that require cooperation to solve. Under this premise, the South Asian Economics Students’ Meet (popularly known as SAESM) came to life with valuable contributions made by five leading South Asian Universities offering Economics Degrees; the University of Delhi in India; Lahore School of Management Sciences in Pakistan; University of Dhaka in Bangladesh; University of Colombo in Sri Lanka and Tribhuvan University in Nepal.

Setting the Stage for Making Public Money Count

Rubaba Anwar's picture

Sitting out in the sun, in the middle of a public school premises, I intently looked at a woman clad in a patchy orange saree carrying a lean child on her lap. It was hard not to wonder whether her bare five years of primary school education really helped her understand public financial management! Indeed I was wrong. It was the sheer urge of entertainment and not curiosity about public financial management that drew her, and many more like her, to the premises of a government owned school in Hazaribaag, near the Beribaad, Mirpur area of Dhaka.

Is SKS Any Different from Wal-Mart, and Does it Matter if It Isn’t?

Malcolm Harper's picture

This post is the second in a special blog series on the Microfinance Institution, SKS and it's IPO launch in partnership with CGAP. Over the coming weeks we’ll be featuring a variety of voices on the issues raised by the IPO. We welcome your participation in this discussion through comments.

This is the first time that I have knowingly contributed to a ‘blog’; hence I am not familiar with medium’s etiquette.  Am I to oppose, to concur, or to add? I’ll try to do all three.

Steve Rasmussen poses a number of important questions; they are mostly about the future, and about clients, which is surely where our focus should be.

I shall not comment on the rights or wrongs, legal or ethical, of the ways in which the shareholdings of the SKS clients’ Mutual Benefit Trusts were handled; Professor Sriram has already covered that issue, very well. 

Six Questions for Indian Microfinance Institution SKS

Stephen Rasmussen's picture

This post kicks off a special blog series on the Microfinance Institution, SKS and it's IPO launch in coordination with CGAP. Over the coming weeks we’ll be featuring a variety of voices on the issues raised by the IPO. We welcome your participation in this discussion through comments.

A rare microfinance occurrence took place in late July this year. The Indian microfinance institution, SKS, became the second pure microfinance institution (MFI) globally to go public by listing its shares on the stock market. SKS is one of the largest microfinance institutions in the world with almost 6 million clients, mostly poor women living in rural areas. It has also been one of the fastest growing MFIs over the past few years, with a compound annual growth rate of 165% since 2004.

From one perspective, the IPO was a great success. It was 13 times oversubscribed, the company valuation reached the top of the offer band price (valuing the company at $1.5 billion), and the share price rose 42% in the first five weeks of trading. In the process SKS raised $155 million in fresh capital that will allow it to grow and serve far more people than it reaches now.

The Inexorable March of Branchless Banking

Ignacio Mas's picture

There are two ‘coming of age’ tests for bold new ideas. The first, still in the realm of the market for ideas, occurs when the concepts become entrenched as conventional wisdoms, when you no longer need to justify them as ideas. The second is when they gain traction in the marketplace, when you no longer need to justify them as a business proposition.

The ground has shifted massively on both counts since I wrote about the opportunities from branchless banking in this blog more than two years ago. Few now would dispute that a key step to achieve much broader financial inclusion is to take banking transactions outside of banking halls and into everyday retail establishments that exist in every village and every neighborhood, and that financial service providers need to put technology in the hands of customers (in the form of cards or, better still, mobile phones) to increase the convenience and security of those transactions.

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