MICROCAPITAL BRIEF: Microfinance Providers in Pakistan Report 19.4% Increase in Savings, 5.55% Increase in Microinsurance Clients in Second Quarter of 2013

Between April and June of 2013, the value of savings held by Pakistan’s microfinance providers (MFPs) reportedly increased by 19.4 percent from the previous quarter to total PKR 30 billion (USD 282 million). An overall increase in the number of active depositors, which rose by 8.4 percent to 5.2 million from the previous quarter, as well as an increase in average savings balance by 10.2 percent to PKR 5,760 (USD 54) contributed to the increase in the value of savings. The number of active borrowers grew four percent to 2.6 million as compared to the previous quarter. The aggregate gross loan portfolio of MFPs grew 7.2 percent to PKR 46.6 billion (USD 438 million) and the average loan size was PKR 26,004 (USD 244) at the end of June 2013.

Microfinance Banks (MFBs) reportedly contributed the largest amount to the increase in savings, as they collectively added 310,000 depositors and PKR 4.8 billion (USD 45 million) worth of deposits. Tameer Microfinance Bank, a Pakistan-based commercial bank, and Khushhali Bank, a Pakistani microfinance bank, added 226,000 depositors and PKR 2 billion (USD 18.8 million) in the second quarter of 2013.

Microinsurance in the country also performed positively in the second quarter of 2013. The number of policyholders increased by 5.5 percent to 3.1 million. The National Rural Support Programme (NRSP), a Pakistani nonprofit organization that aims to alleviate poverty and develop rural areas, remains the largest provider of microinsurance with a 24.7 percent market share in terms of the number of policyholders and 29.8 percent in terms of the sum insured.

As of 2013, there reportedly are 34 microfinance providers in Pakistan.

By Adrija Vaiciulionis, Research Associate

About Tameer Microfinance Bank Limited (TMFB):
Tameer Microfinance Bank Limited (TMFB) is a licensed commercial bank in Pakistan that provides services such as small business, group and emergency loans; micromortgages; microinsurance; savings; and money transfers. It was founded in 2005 and is based in Shahrah-e-Faisal, Pakistan. Telenor Pakistan, a subsidiary of the Norwegian mobile communications company Telenor, owns 51 percent of TMFB. As of 2011, TMFB reported to the US-based nonprofit Microfinance Information Exchange (MIX) total assets of USD 92.1 million, return on assets (ROA) of 1.76 percent and return on equity (ROE) of 8.56 percent. As of August 2012 data reported to MIX, TMFB had a gross loan portfolio of USD 70.3 million, 152,297 active borrowers, deposits totaling USD 71.4 million and 942,186 depositors. TMFB’s financial information for 2012 is unavailable.

About Khushhali Bank:
Khushhali Bank is a Pakistani microfinance bank that was founded in 2000 as part of Pakistan’s Poverty Reduction Strategy and its Microfinance Sector Development Program (MSDP). Initially operated by the State Bank of Pakistan, the country’s central banking authority, Khushhali Bank was converted into a public limited company on April 1, 2008. Its shareholders now include Habib Bank Limited, MCB Bank Limited, United Bank Limited and Allied Bank Limited. As of 2012, Khushhali Bank reported to the US-based nonprofit Microfinance Information Exchange (MIX) total assets of USD 102 million, a gross loan portfolio of USD 59 million, return on assets (ROA) of 0.23 percent, return on equity (ROE) of 0.87 percent and 366,000 active borrowers.

Sources and Additional Resources:

International Herald Tribune, “Savings with Microfinance Providers Rise 19%,”
http://tribune.com.pk/story/598840/savings-with-microfinance-providers-rise-19/

MicroCapital Article, January 24, 2013, “MICROCAPITAL BRIEF: Pakistan’s Tameer Microfinance Bank Lists Term Finance Certificate Worth  $10m on Karachi Stock Exchange,”
https://www.microcapital.org/microcapital-brief-pakistans-tameer-microfinance-bank-lists-term-finance-certificates-worth-10m-on-karachi-stock-exchange/

MicroCapital Article, March 12, 2012, “MICROCAPITAL BRIEF: Afghani Microfinance Organizations, Prakistan’s Khushhali Bank Mull Collaboration,”
https://www.microcapital.org/microcapital-brief-afghani-microfinance-organizations-pakistans-khushhali-bank-mull-collaboration/

MicroCapital Article, August 22, 2011, “MICROCAPITAL BRIEF: State Bank of Pakistan (SBP) Reports 13% Quarterly Decline in Microfinance Bank Deposits, Slow Recovery After 2010 Floods,”
https://www.microcapital.org/microcapital-brief-state-bank-of-pakistan-sbp-reports-13-quarterly-decline-in-microfinance-bank-deposits-slow-recovery-after-2010-floods/

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