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CREATING AN ENABLING

ENVIRONMENT FOR THE WE3


REFORMS AGENDA FOR THE BANKING INDUSTRY

D O N OT P U S H T H E R E L U C TA N T B A N K E R
PRESENTED BY:

SULTAN TIWANA
The views expressed in this paper are the views of the authors and do not necessarily reflect the views or policies of the Asian Development Bank (ADB),
or its Board of Governors, or the governments they represent. ADB does not guarantee the accuracy of the data included in this paper and accepts no
responsibility for any consequence of their use. The countries listed in this paper do not imply any view on ADB's part as to sovereignty or independent
status or necessarily conform to ADB's terminology.

BACK GROUND
Access to Finance for Women Entrepreneurs

1994- 99: Bank of Khyber; Financing 12000 clients, approx. 20%


women, Management advise for clients capacity needs, Informal
Business advise and no BDS.

1999- 14: SMEDA; 80,000 Clients, Less than 15% WEs Management
& Business Advise, capacity building and BDS Facilitation, where
BDS on Fee basis.
2008- 14: Rural Enterprise Development (AHAN) Approx. 10,000
entrepreneurs, 40% WEs. Capacity building and product
improvement. No Business advise, BDS or Financing

2011- 12: Rural Enterprise Development (UNDP-ER) Approx. 12,000


entrepreneurs, 40% WEs. Grants for Capacity building and Seed
Capital with Business advise and BDS

2014- Cont: Prime Ministers Interest Free Loan Program; 1,000,000


Proposed, 50% of WEs, No interest charge Financing. Capacity
Building, informal Business advise and BDS assistance.

COMPARATIVE ASSESSMENT OF
WOMEN PORTFOLIO-(++)

20 years
apart

BoK Funding (Phase I)

PMIFL Funding (Phase II)

PKR 600 M- 12,000


Beneficiary

PKR 3.5 B- 0.1 M


Beneficiaries

Markup based

Interest Free

Med Term Loan

Short Term Loans

Weak BDS ( Simple Advisory)

Business plans & BDS

Communitys social collateral

NGOs supported

98.4% recovery

98% guaranteed

What did we learn? Prudence and Reliability are Foundations of a great (Financial) relationship
& Women Outscore

Enterprise Development Cycle


Intention
or NEED
Grant &
or Equity
Funding

Technical
Assistance

Business
Idea

Successful
Women
Entrepreneur

& BDS

Skills
Training

Resource &
sponsor
Assessment

Gap
Analysis
Information
sources

Enterprise
Growth

MAPPING THE ROUTE TO


SUCCESS
Successful
Entrepreneur

Startup

Product
development,
distribution and
Initial guidance, Market advice,
business plan, BDS, Stage-I
technology
Angel Financing
selection, initial
investment and
equity Financing
startup
assistance,

Inventory
Management,
Operations
efficiency and
productivity,
Stage-II
working
capital
Financing

Expansion
planning,
Stage-III
Project
Financing

WE3 NEED MORE PLANNING &


CAPACITY
New Entrepreneurs need Mentors
Startups need Business counselors, Advisors and BDS

Before Financing they require Capacity building and Grant Funding


Before Financing they should be in Market
New Entrepreneur requires a support system to survive the
unexpected shocks.
Bank Financing is easier with Credit Guarantee backed by social
collateral.

Success is on
a ladder

HIERARCHY OF NEEDS
Market
development,
Sourcing and
R-compliance
Financing Facilitation &BDS

Capital- Equity and Grants contributions

Business Plan, Technical assistance, Capacity building


and Start up facilitation

INVESTMENT VS. GRANT


RISK VS. REWARD

Risk Financing

Growth

Grant

Income

Growth

RISK

Income

REWARD

Investment

Plan to
Manage Your
Business

MANAGE YOUR INVESTMENTIN STARTUP PHASE


Know what you have and what you need

Outsourcing
BDS
Savings

Savings
Primary sources
Utilise carefully

Business
Development
Ensure you are
generating enough
income to pay BDS

Outsourcing
Invest and appreciate
capital over time
Ensure payments for OS

READY TO MOVE WE3


Talk to Community/ Association and find a mentor
Engage a business Advisor or a consultant
Assess what investment requirement can you outsource

Engage Business Development Services


Visit a Banker & Start relationship Now, for Future reference

Bankers like relationships and


offer better advise to their clients.

FOUR STEPS TO BEING SMART BANKER


SMART BANKERS PROMOTE PRUDENT BUSINESSES
Female staff engage Women borrowers more efficiently.
Recommend Business Advisors to WEs for Reliable, Efficient & Economical
Services.
(Women Business Advisors & Consultants have better insight and intuition in
WEs. Help WEs Access (partial) BDS funding, It has been done)

Get Third Party Evaluations, Trust me,


BASIL III Recommends it .

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