MICROCAPITAL BRIEF: Canadian Government Donates $6.7m to DID, Sanasa to Establish Entrepreneur Financial Centre (EFC) Offering Microfinance in Sri Lanka

The Canadian government recently announced a donation of CAD 8.8 million (USD 6.7 million) to be disbursed over four years for the creation of an Entrepreneur Financial Centre (EFC) in Sri Lanka, jointly implemented by Développement International Desjardins (DID), a unit of Canadian cooperative Desjardins Group that promotes financial services in developing countries, and Sanasa Development Bank PLC, a Sri Lankan bank that provides low-income people with loans, voluntary savings, leasing and fund transfer services. In addition to traditional financial services, the EFC will offer enterprise training targeted at smallholder farmers and Sri Lankans managing small and medium-sized enterprises (SMEs), especially women. Although DID operates EFCs in Panama, Tanzania, Tunisia, Uganda and Zambia, this institution will be run by Sanasa as part of its cooperative structure.

As of 2015, DID’s EFCs had a total of 36 branches serving 32,000 clients with a total loan portfolio of CAD 63.5 million (USD 48.6 million). DID also manages two funds with a “total budget of CAD 40 million (USD 30.6 million)” that invest loans and capital in microfinance institutions and other funds focused on microfinance. Sanasa reports total assets of LKR 60.3 billion (USD 415 million), total loans and receivables of LKR 45.8 billion (USD 315 million), deposits of LKR 43 billion (USD 296 million) and LKR 1.11 billion (USD 7.34 million) in pre-tax profit for 2015.

By Michelle Dold, Research Associate

About Développement International Desjardins (DID)

Développement International Desjardins (DID) is a Canadian nonprofit corporation that specializes in providing technical support and investment for the community finance sector in emerging economies. It assists organizations in approximately 30 nations in Africa, Asia, the Caribbean, Central and Eastern Europe and Latin America. DID is a component of the Desjardins Group, a financial cooperative offering banking, insurance, securities and investment services, with approximately CAD 248 billion (approximately USD 197 billion) in assets as of 2015. DID has two funds that provide loans and investment capital to microfinance institutions and funds specializing in microfinance, the Partnership Fund and the Desjardins Fund for Inclusive Finance. DID reports that, as of 2015, the two funds had “an overall budget of CAN 40 million (approximately USD 30 million)”. In the past, DID managed the now-closed Guarantee Fund, and as of 2015, was winding down Fonds d’investissement pour le développement international (FONIDI).

DID also organizes the Proxfin network of 30 community finance institutions and directly operates “entrepreneur financial centers” (EFCs) in Panama, Tanzania, Tunisia, Uganda and Zambia. As of 2015, the EFCs in Tanzania, Uganda and Zambia accepted deposits. The four EFCs other than the one in Tunisia claim aggregate assets of CAD 68 million (USD 54 million), a loan portfolio of CAD 53 million (USD 43 million), deposits of CAD 12 million (USD 9 million) and 32,000 clients.

About Sanasa Development Bank PLC (SDBL)

Established in 1997 in Colombo, Sri Lanka, SDBL targets low-income communities in both urban and rural areas providing loans, voluntary savings, leasing and fund transfer services. For the year 2015, SDBL reported total assets of LKR 60.3 billion (USD 415 million), deposits of LKR 43 billion (USD 296 million), total loans and advances of of LKR 45.8 billion (USD 315 million) and LKR 1.11 billion (USD 7.34 million) in pre-tax profit for 2015.

Sources and Additional Resources:

[1] Développement International Desjardins (DID): “Project to Support Entrepreneurship in Sri Lanka.”, http://did.qc.ca/en/news/project-support-entrepreneurship-sri-lanka-150/

[2] News.lk: “Canada and Sri Lanka Reinvigorate Relations.”, http://www.news.lk/news/related-news/item/14038-canada-and-sri-lanka-reinvigorate-relations

[3] Développement International Desjardins (DID): “2015 Annual Review.”, http://www.did.qc.ca/media/documents/en/rapport-annuel/DID-AnnualReport2015.pdf

[4] Sanasa Development Bank PLC (SDBL): “Transforming Together: Annual Report 2015.”, http://www.sdb.lk/wp-content/uploads/2016/05/SDB-bank-Annual-Report-2015.pdf

[5] MicroCapital Universe Profile: Sanasa Development Bank Limited

[6] MicroCapital Universe Profile: Développement International Desjardins

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