In Search of Sustainability: The Provision of Rural Financial Services in Solomon Islands
This report discusses the financial ecosystem in Solomon Islands, with a particular focus on retail financial services being provided in rural areas. It provides a brief history of rural finance in Solomon Islands and then outlines the current situation. It highlights the lack of sustainable provision of rural financial services in the area.
The Solomon Islands has never had a model that follows global best practices or has reached sustainability on a significant scale, despite several attempts to provide financial services in rural areas. Findings include:
- Areas with relatively high population densities, modern infrastructure and active economies relative to the rest of the country offer significant potential for financial services provision;
- Microcredit in rural areas should focus on deposit taking and domestic money transfers;
- Some credit unions and savings clubs in Isabel have proven resilient and may offer an indigenous, immediate strategy for offering financial services in these rural areas.
The provision of financial services in Solomon Islands would involve substantial changes on all levels, a coordinated effort among stakeholders, and smarter investment in sustainable solutions.