Lebanon Microfinance Program Holds Round Table on Challenges and Opportunities for Microfinance Institutions
BEIRUT – The USAID-funded Lebanon Investment in Microfinance Program held a focus group and round table discussion session titled ‘Year 2011/2012 Challenges/Opportunities, LIM Services, and Linking to Credit Registry’ at the Dunes Holiday Inn, Beirut. The meeting engaged seven program partner Microfinance Institutions (MFIs), in addition to senior economic growth representatives from USAID Lebanon, Central Bank of Lebanon senior representatives, and the LIM team in a brainstorming session centered on the microfinance sector challenges and opportunities. The LIM Program partners who attended the session included the Association for the Development of Rural Capacities (ADR), the Association d’ Entraide Professionnelle (AEP), AlMajmoua, Ameen, the Lebanese Cooperative for Development (CLD), Emkan, and the Makhzoumi Foundation.
This session work addressed the feasibility of linking the MFIs to the credit registry managed and regulated by the Central Bank for all active Microfinance Institutions (MFIs) operating across the Lebanese territory to minimize the adverse impact of Cross Lending. This step restricts the disbursement of loans to borrowers with bad credit history. The discussions addressed the potential approach of having the Central Bank recognize the MFI status as authorized lenders; the seven MFIs currently partnering with the LIM Program represent Non-Governmental Organizations (NGOs), Cooperatives (COOPs) and financial institutions. It also addressed the sector’s challenges and opportunities and the impact of the LIM Program technical assistance in supporting the MFI growth and development, future sustainability of the MFIs, cost and sources of funding in the upcoming year and the issue of secure lending and utility of mobile banking for the MFIs.
As a result of the roundtable, the participant MFI representatives, USAID, Central Bank senior representatives, and the LIM team agreed to work to realize the anticipated outcome of addressing the legal status of all the MFIs operating across the Lebanese territory; recognizing and regulating their status as financial service provider entities, and endeavour to link the MFIs to access the credit registry managed by the Central Bank that will supervise manage and regulate the activities of all financial institutions in Lebanon.