Tarayana Micro Finance recently became licensed as a microfinance institute (MFI), independent of its incubator, the Tarayana Foundation of Bhutan. The MFI provides individual and group loans in rural areas, with interest rates of 15 percent. Smaller “classic” loans support existing enterprises, while larger loans are available for “pre-selected livelihood models with a proven market and reliable value chain.” These larger “development” loans are disbursed in the form of “materials and equipment” and paired with “intensive skills training and continuous progress monitoring.”
Borrowers may make repayments electronically via Bhutan Telecom’s mobile money product B-Ngultrum. The product allows users to submit payments without need for bank accounts or smart phones.
In working toward the “vision of financial inclusion for growth and development so that all citizens live productively, and with dignity,” Her Majesty The Queen Mother Ashi Dorji Wangmo Wangchuck said, “Skills training and handholding services are to be provided to our clients so that together, we can ensure their prosperity in the long run. Special focus on consumer protection and adequate financial literacy training will be provided to all potential clients in the communities.”
The program is now available in three of the nation’s districts for an 18-month trial period. Thereafter, the MFI plans to expand nationwide.
Sources and Additional Resources
Kuensel article
https://kuenselonline.com/tarayana-launches-micro-loans-for-rural-development/
Tarayana Micro Finance homepage
https://tarayanamicrofinance.com/
Tarayana Foundation homepage
https://www.tarayanafoundation.org/
More news on Bhutan
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