12.12.09
Bank of Thailand Visit
Common Interest hosted 18 members from the Bank of Thailand (BOT) on Friday. The purpose of the trip was for the the BOT to get a better understanding of current microfinance programs being offered in the country. A full day was spent in Phrao as the BOT watched and interacted with members who came for collections.
The day also allowed Common Interest the opportunity to ask questions and get clarification on the new Master Plan Phase II. The Master Plan includes a framework for microfinance activity in Thailand which will have a significant impact on how organizations can operate into the future. Both parties found the day to be very productive.
The day also allowed Common Interest the opportunity to ask questions and get clarification on the new Master Plan Phase II. The Master Plan includes a framework for microfinance activity in Thailand which will have a significant impact on how organizations can operate into the future. Both parties found the day to be very productive.
8.12.09
Common Interest to Host Bank of Thailand
Dec 8, 2009
Common Interest is hosting a 20-member team from the Bank of Thailand (BOT) this Friday. Senior policy directors from Bangkok will be arriving into Chiang Mai to spend the day learning more about Common Interest and its microfinance program.
The reason for the visit stems from the government’s recent decision to revise the regulations governing microfinance activities in the country. Co-sponsored by the Ministry of Finance and the BOT, the Master Plan Phase II provides a new framework in which microfinance will be able to legally operate. Currently, there is no clearly defined legal structure. While the goal is to promote the microfinance sector, it will also have a significant impact on the 30+ organizations that currently operate in Thailand.
The new regulations promote the commercial side of microfinance. By making the microfinance sector “business-friendly,” the hope is that large-scale operations will be attracted to the potential for huge profits. The assumption is that by increasing the number of players, the competition will not only reach more people but will lower the transaction costs for the client. The BOT is hoping that several local banks will be attracted to start microfinance programs right away. To increase the incentive to start, local banks will given a 2 year head start on others. From 2010-2012, local banks will be the only institutions granted a microfinance licence.
These changes have a significant impact on the existing non-governmental microfinance programs. Not only do most lean to the social side of the spectrum, very few have the potential to be commercially viable. Many worry that the new changes will the existing MFIs to close down
The BOT has decided to visit a number of organizations to get a better understanding of how the new regulations will affect the microfinance sector. Common Interest is looking forward to presenting our concerns to the government and collaborating to find a workable solution.
Common Interest is hosting a 20-member team from the Bank of Thailand (BOT) this Friday. Senior policy directors from Bangkok will be arriving into Chiang Mai to spend the day learning more about Common Interest and its microfinance program.
The reason for the visit stems from the government’s recent decision to revise the regulations governing microfinance activities in the country. Co-sponsored by the Ministry of Finance and the BOT, the Master Plan Phase II provides a new framework in which microfinance will be able to legally operate. Currently, there is no clearly defined legal structure. While the goal is to promote the microfinance sector, it will also have a significant impact on the 30+ organizations that currently operate in Thailand.
The new regulations promote the commercial side of microfinance. By making the microfinance sector “business-friendly,” the hope is that large-scale operations will be attracted to the potential for huge profits. The assumption is that by increasing the number of players, the competition will not only reach more people but will lower the transaction costs for the client. The BOT is hoping that several local banks will be attracted to start microfinance programs right away. To increase the incentive to start, local banks will given a 2 year head start on others. From 2010-2012, local banks will be the only institutions granted a microfinance licence.
These changes have a significant impact on the existing non-governmental microfinance programs. Not only do most lean to the social side of the spectrum, very few have the potential to be commercially viable. Many worry that the new changes will the existing MFIs to close down
The BOT has decided to visit a number of organizations to get a better understanding of how the new regulations will affect the microfinance sector. Common Interest is looking forward to presenting our concerns to the government and collaborating to find a workable solution.
