1. RECAP DAY ONE Six presentations were done; (2 Central Bank, 1 MFIs, 2 commercial bank and 1 Government) Six presentations were done; (2 Central Bank, 1 MFIs, 2 commercial bank and 1 Government) Critical issues faced on the point of view from Central Bank (Mozambique): All indicators of financial deepening point to the fact that the Financial sector in is shallow even by sub-Saharan Africa standards All indicators of financial deepening point to the fact that the Financial sector in is shallow even by sub-Saharan Africa standards

2. RECAP DAY 1 Cont’d… Incentives to broaden and widen the financial sector; Incentives to broaden and widen the financial sector; Adjustment/relaxation in Reserve Requirement; Adjustment/relaxation in Reserve Requirement; Help reducing transaction costs (Central Bank New branches) Help reducing transaction costs (Central Bank New branches) Regulatory enhancement (decree No. 57/ 2004; Regulatory enhancement (decree No. 57/ 2004;

3. RECAP DAY ONE CONT’D … Challenges  Introduce savings culture rural communities Improve basic infrastructure Improve basic infrastructure Break the myth that Agricultural as a risky activity Break the myth that Agricultural as a risky activity Introducing an explicit deposit insurance scheme for low income depositors Introducing an explicit deposit insurance scheme for low income depositors Create private CRCs Create private CRCs

4. RECAP DAY 1 Constraints in promoting the expansion of financial services to rural areas Constraints in promoting the expansion of financial services to rural areas Asymmetric information Asymmetric information Seasonality of income Seasonality of income sparse population base in rural areas sparse population base in rural areas Massive Illiteracy Massive Illiteracy Need to acknowledge that Microfinance is not a panacea (instead, is one of the tools for poverty alleviation – need for sustainability)

5. RECAP DAY 1 Point of View for MFIs Point of View for MFIs Critical Issues Critical Issues Need for government intervention (Infrastructures, incentives, transaction cost reduction) Need for government intervention (Infrastructures, incentives, transaction cost reduction) Lack of tangible collateral Lack of tangible collateral Importance of value chain Importance of value chain Demand driven approach in delivering financial services Demand driven approach in delivering financial services Linkages and partnership Linkages and partnership

6. RECAP DAY 1 GOVERNMENT POINT OF VIEW Play a supportive role – Start up Capital Play a supportive role – Start up Capital Rural Finance Strategy (underway) Rural Finance Strategy (underway) Fund for facilitating innovation and expansions of rural finance Fund for facilitating innovation and expansions of rural finance Partnership between MFIs and Rural Finance Partnership between MFIs and Rural Finance Need to ensure institutional articulation/coordination between FARE and all other stakeholders Need to ensure institutional articulation/coordination between FARE and all other stakeholders

7. THANK YOU!