The State of in Developing Countries: Perspective Ananya Raihan October 24, 2001, Geneva E-Finance...
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Transcript of The State of in Developing Countries: Perspective Ananya Raihan October 24, 2001, Geneva E-Finance...
The State of
in Developing Countries:
Perspective
Ananya Raihan
October 24, 2001, Geneva
E-Finance
Bangladesh
Centre for Policy Dialogue
What About
• Status of Access to Credit by SMEs
• E-finance in Bangladesh
• E-finance Initiatives in Bangladesh
•Challenges of E-finance for LDCs
Status of Access to Credit by SMEs
•50.53% of SMEs have no access to formal source of finance
•Only 35.79% of SMEs enjoy unrestricted access to credit
•Bank credit is less than 20 percent of total fund outlay
•Majority of the SMEs seek finance for working capital needs
E-finance in Bangladesh
• Credit card and POS services
• Telebanking
•ATM
•Online corporate banking
•EFT
•Intenet Banking
E-finance Initiatives in Bangladesh
• E-finance for Self Employment
• Secured Transaction Law and Electronic Collateral Registry
• E- Credit for SMEs
E-finance for Self Employment
• A Grameen Bank Initiative
• A Network of ATM and POS Country wide
• Smart Card
•Initially Serving Own Clients of Micro-finance
• Gradually Other MFI members
•SME Clients
•Large Clients
•Access to Credit Will Improve by 10%
Secured Transaction Law and Electronic Collateral Registry
Problems of Access
•Collateral Security: Problem for 79.4 percent of SMEs
• Credit Risk Information
• Realisation of Credit Claim
Secured Transaction Law and Electronic Collateral Registry
Solutions
•Collateral Security: Immovable Property
• Country wide Centralised Network Based Collateral Registry System
• Secured Transaction Law
Secured Transaction Law and Electronic Collateral Registry
Impact
•Improved Access to Credit
• Improved Risk Management by FIs
• Informal to Formal
E- Credit for SMEs
•Initiator: BASIC
• Network Infrastructure and Shared ATM
• Higher Limit Credit Cards addressing Working
Capital Problem
Building Foundation for E-finance
• Online Business Information Services
• E-Credit Information
Challenges of E-finance for LDCs
•Network Infrastructure
•Capacity Building: Human, Technical and Regulatory
•Investment
•Legal Infrastructure
•Macro Policy
•E- Culture
E-finance: Bangladesh 13
• Intra-bank and Inter-bank Connectivity:
» Local and Global
• Bank-Client Connectivity
• Security of transaction
Network Infrastructure
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E-finance: Bangladesh 14
• Central Bank: Quick Settlement, Online credit
Information, Skilled e-Manpower, Regulatory
Framework
• FIs: Understanding E-finance
Capacity Building: Human, Technical and Regulatory
p
E-finance: Bangladesh 15
• Misconceived Investment Strategy
• Inadequacy of Investment
Investment
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E-finance: Bangladesh 16
• Amendments of a Set of Laws
• Incorporation of New Laws: Cyber Law and digital
signature law
• Digital Crime: Network Security and Penal Code
Legal Infrastructure
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E-finance: Bangladesh 17
• Currency Convertibility: Access to Global Finance
• International Reserve: Money Laundering• Clear cut instructions for electronic
transaction in Forex Manual
Macro Policy
p
E-finance: Bangladesh 18
• Technical Assistance• Investment• Funding of Technical Assistance• Pioneering Initiatives
What to Do
p