Open Days 2007 Micro-credits for Regional and Local Development Brussels, 10 October 2007

% of low income households w/bank accounts Georgia – 1% Azerbaijan – 16% Ukraine - 17% Romania – 22% Poland – 67% Poland microcredit demand study: 2 mln potential clients 14% existing micro-ent 86% potential ent There are 65 mln low income households and entrepreneurs in ECA. Less than 5% has access to financial services Avg. MFIs penetration rate: 3% Financial exclusion is high and the demand for microfinance significant

Average non-bank MFI in Eastern Europe Gross loan portfolio: US$ 12 million Active borrowers: 6,400 Depth of outreach: 83% Female clients: 49% Rural borrowers: 50% Sustainability: 127% PAR>30 days: 4%

Current Constraints and Gaps for the development of non-bank financing Enabling environment tranformation options interest rate regulation tax codes non-profit status definition barriers to MFI borrowing Funding Growing demand for commercial funding

Current Constraints and Gaps for the development of non-bank financing Infrastructure access to credit bureaus limited or non- existant weak country level associations limited specialised consulting support Market coverage gaps limited scale and depth of ourtreach, urban bias (unless targeted to serve rural areas)

Current Constraints and Gaps for the development of non-bank financing Products and services current operations are for credit only Limited products for start-ups Institutional gaps strategic planning limited in scope weak governance systems cost accounting and treasury functions missing HR functions underdeveloped Systems for managing social performance not in place

Action Research Policy Work Sector monitoring and analysis Training and Consulting Other MFIs Donors Investors Policy makers 107 member institutions in 26 countries across Central & Eastern Europe, Caucasus, Central Asia and Russia Networks role in promoting inclusive finance: example Microfinance Centre (MFC) for Central and Eastern Europe and the New Independent States Member MFIs Regional Networking & Information Exchange Support to Country Networks Market studies