The Asian Development Bank (ADB) and the government of Australia recently launched the “Microfinance Expansion Project” in Papua New Guinea in a bid to increase financial access.
15 percent of people in Papua New Guinea have access to formal or informal banking services, according to ADB estimates. In addition to providing microfinance services, the project would also provide training programs to enhance financial literacy, with an aim to reach approximately 120,000 people. The project is to be completed by 2017.
The ADB will finance 54 percent of the cost of the USD 24.1 million project through loans to the Papua New Guinea government. AusAID, the development finance institution of Australia; the Papua New Guinean government; and unspecified donors will finance the rest of the program. The loans provided by the ADB have a maturity of 32 years, and carry an interest rate of one percent for the first eight years and one and a half percentage points for the remaining 24 years. Details regarding the methods for distributing funds have not yet been released.
The Papua New Guinean MFIs submitting data in 2009 to the Microfinance Information Exchange (MIX), the microfinance information clearinghouse, reported an aggregate loan portfolio of USD 6 million, total assets of USD 22.6 million and 4,974 active borrowers.
About the Asian Development Bank (ADB):
Established in 1966 and headquartered in Manila, the Philippines, the Asian Development Bank (ADB) is a regional development bank that consists of sixty-seven members, of which forty-eight are based in the region and nineteen are based outside the region. The ADB has three strategic agendas: to foster inclusive growth, to facilitate regional integration and to ensure environmentally sustainable growth. To accomplish these objectives, the ADB uses loans, technical assistance programs, grants and direct assistance in the form of equity investments, guarantees and credit to private companies in member countries. The ADB reported a total capitalization of USD 56 billion as of December 31, 2009.
By Trevor Kwong, Research Assistant
Source Article and Additional Resources:
[1] Source Article: ADB, Australia to Help Papua New Guinea Expand Microfinance to Rural Poor:
http://www.adb.org/Media/Articles/2010/13377-papua-new-guinea-microfinance-projects/
[2] MicroCapital Universe: Asian Development Bank:
https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Asian+Development+Bank+(ADB)
[3] Microfinance Information Exchange (MIX): Papua New Guinea:
http://www.mixmarket.org/mfi/country/Papua%20New%20Guinea
Browse the MicroCapital Universe and add your entry to the wiki at https://www.microcapital.org/microfinanceuniverse/tiki-index.php
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