M M Attanayake, the president of the 71-member Lanka Microfinance Practitioners’ Association (LMFPA), recently urged policymakers to amend existing law to allow microfinance institutions (MFIs) to offer microinsurance. He also said that MFIs should be able to make use of the Credit Information Bureau of Sri Lanka.
Dr. A.T. Ariyaratn, who founded a group of community organizations known as the Sarvodaya Shramadana Movement, said he has “concerns on the impact of the recent budget proposal not to report credit information of loans below LKR 500,000 (USD 3,300).”
The men added that better credit information could prevent multiple borrowing and defaults as well as keep MFIs from asking borrowers for “high-end collateral.”
LMFPA, which was founded as the Lanka Microfinance Network in 2006, consists of 71 member organizations, including microfinance institutions, cooperatives and NGOs. As of 2016, its members serve a total of 700,000 borrowers and 100,000 depositors with a gross loan portfolio of LKR 70 billion (USD 458 million) and total deposits of LKR 900 million (USD 6 million).
By Sascha Strobl, Research Associate
Sources and Additional Resources:
Lanka Microfinance Practitioners’ Association:
Lanka Microfinance Practitioner’s Association on the MIX:
Credit Information Bureau of Sri Lanka:
Sarvodaya Shramadana Movement:
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