Paper

Self-Assessment Tool for Microfinance Legal and Regulatory Reform: Assessment of Financial Regulation and Access for the Poor in Georgia

Analyzing Georgia's microfinance market
Download 25 pages

This paper discusses the Self-Assessment Tool for Microfinance Legal and Regulatory Reform project to develop a tool to assess a country's legal and regulatory environment. The tool aims to guide analysis leading to strategies for reform, and present typical scenarios coupled with various institutional issues that developing and transition countries face when expanding poor people's access to finance.

The paper presents a case study on Georgia, and analyzes its financial services market, regulatory and supervisory environment and governance factors affecting microfinance. It also discusses options for transformation among non-licensed MFIs.

The paper highlights the small scale and inability of MFIs to offer a full range of complementary services. It states that:

  • Georgia's microfinance market is in flux with institutions trying to understand their own competitive advantages and settle into market niches;
  • Variety of institutions serve the low-income market with a variety of products;
  • Institutions are moving towards small and micro-enterprise lending;
  • Consolidation of various financial institutions and NGO MFIs is likely;
  • Judiciary reform will help overcome inefficiencies and ease financial intermediation;
  • Implementation of broad institutional categories will allow for choice in market niches and promote innovation and stability.

About this Publication

By Druschel, K. & Reinke, J.
Published