Final Report of the Workshop on Microfinance Promotion in Post-Tsunami Period

This document is a report on the workshop on 'Microfinance Promotion in Post-Tsunami Period' held in March 2005, at the Sri Lanka Foundation Institute, Colombo.

The document presents the proceedings of the workshop and synthesizes the three panel discussions as follows:

• Panel 1 discussed the pros and cons of using loan write-off versus rescheduling:
  • Loan write-off is not a best practice and so should be used as the last resort;
  • It should be demand-oriented rather than supply-driven;
  • MFIs should create loan loss provision to cover losses in case of write-offs.
• Panel 2 discussed the benefits of grants vis-à-vis loans for MFIs:
  • Grants should be used only for immediate relief;
  • Clients affected by calamities need immediate access to loans to rebuild their livelihoods;
  • In the event of disasters like tsunami, MFIs could use a combination of loans and grants. However, this should be done with clear demarcation in their purpose and utilization.
• Panel 3 discussed the scope for coordination of relief efforts:
  • MFIs should form a forum that would envision and work towards common goals;
  • MFIs should also coordinate their efforts with other stakeholders like donors and government agencies.

Further, the document states that the workshop acted as a platform for the introduction of the microfinance website, www.microfinance.lk, launched by the Rural Banking Innovations Project (RBIP). Finally, it concludes with a future plan discussed in the workshop to promote microfinance in the post-tsunami period.