Annual Report 2011-12. Annual Report 2011-12.pdf · Annual Report 2011-12 The Partner for Safe, Sensible & Sustainable Microfinance Promoter Shareholders and Shareholding Pattern

Annual Report2011-12

The Partner for Safe, Sensible & Sustainable Microfinance


...for Safe, Sensible & Sustainable Microfinance

RMDC





The Partner for Safe, Sensible &

Sustainable Microfinance



VisionEmerge as a financially viable, operationally sustainable and professionally efficient institute for wholesale lending to microfinance institutions in Nepal.



Vision MissionReaching out to the largest number of the poor and disadvantaged households with appropriate microfinance services to enable them to realize their untapped potentials of development through the partner MFIs.



Serving over 1.5 million poor families across the country with quality microfinance services through 150 partner organizations by the end of 2015.

Goal



Promoter Shareholders andShareholding Pattern

S.N. Name of Shareholders Amount (Rs.) % of TotalShare Capital

1 Nepal Rastra Bank 21,045,000 6.58

2 Nepal Bank Ltd. 29,355,000 9.17

3 Rastriya Banijya Bank 8,295,000 2.59

4 Nabil Bank Ltd. 50,720,000 15.85

5 Nepal Investment Bank Ltd. 33,810,000 10.57

6 Standard Chartered Bank Nepal Ltd. 52,190,000 16.31

7 Himalayan Bank Ltd. 48,000,000 15.00

8 Nepal SBI Bank Ltd. 18,895,000 5.90

9 Nepal Credit & Commerce Bank Ltd. 7,075,000 2.21

10 Bank of Kathmandu Ltd. 7,075,000 2.21

11 Nepal Bangladesh Bank Ltd. 4,531,000 1.42

12 Everest Bank Ltd. 3,120,000 0.98

13 Lumbini Bank Ltd. 1,534,000 0.48

14 Nepal Industrial & Commercial Bank Ltd. 25,231,000 7.88

15 Purbanchal Grameen Bikas Bank Ltd. 800,000 0.25

16 Sudurpaschimanchal Grameen Bikas Bank Ltd. 800,000 0.25

17 Madhyapaschimanchal Grameen Bikas Bank Ltd. 1,154,000 0.36

18 Paschimanchal Grameen Bikas Bank Ltd. 2,900,000 0.91

19 Madhyamanchal Grameen Bikas Bank Ltd. 1,000,000 0.31

20 Deposit & Credit Guarantee Corporation 1,370,000 0.43

21 Nirdhan Utthan Bank Ltd. 1,100,000 0.34

Total 320,000,000 100

As of July 15, 2012



Contents

A. Message from the Chairperson i

B. Reflections of the Chief Executive Officer iii

1. Introduction 01

2. Corporate Governance 03

General Body 03Board of Directors 03Board Members’ Profile 05Audit Committee 07Management 07Organization Structure 08

3. Report of the Board of Directors 09

4. Auditor’s Report and Financial Statements 15

5. Wholesale Lending to Microfinance Institutions 21

Progress of Lending Program 21Loan Products 22Process of Lending to MFIs 24Salient Features of Partner Organizations’ Credit Program 25

6. Promotion and Capacity Building of Microfinance Institutions 27

Promotion of New MFIs 27Capacity Building of MFI Officials, Staff and Clients 28Onsite Technical Assistances to MFIs 31Capacity Building of MFI Clients 32

7. Growth and Performance of Partner Organizations 35

Outreach 36Loan Portfolio 37Members’ Savings 38Operational Self-Sufficiency 39Staff Productivity 39

8. Monitoring & Follow-up of Partner MFIs 41

Importance of Monitoring 41Monitoring Approach of RMDC 41Risk Based Monitoring and Supervision Framework 42Impact of RMDC’s Monitoring, Supervision and Follow-up System 42

9. Empowering Women Through Microfinance 43

Women Focused Microcredit Program in Nepal 43State of Women before Microfinance 44Changes Observed after Microfinance 45Role of RMDC in Women Empowerment 47

10. International Cooperation 49



AnnexesAnnexes I Institutions that Received Training Supports from RMDC 55

Annexes II Annual Training Progress of RMDC 61

Annexes III RMDC Loan Portfolio with POs 63

Annexes IV Yearwise Loan Portfolio of RMDC 66

Annexes V Status of Partner MFIs 67

Annexes VI Staff Biographies 71

BoxesBox 1 RMDC’s Progress at a Glance 02

Box 2 RMDC’s Eligibility Criteria for Lending 24

Box 3 RMDC’s Parameters of MFI Appraisal for Lending 25

Box 4 Development Impacts of Microfinance at Client Level 26

Box 5 RMDC’s Sequential Steps for Promotion of MFIs 27

Box 6 Performance of RMDC’s Partner Organizations at a Glance 40

FiguresFigure 1 Annual Portfolio Growth of RMDC 21

Figure 2 Annual Progress of MFI Staff Training 28

Figure 3 Annual Progress of MFI Client Training 33

Figure 4 Composition of RMDC’s Partner Organizations 35

Figure 5 Growth in Number of RMDC’s POs 36

Figure 6 Growth of Members & Borrowers of POs 36

Figure 7 Growth of Outstanding Loan of the POs 37

Figure 8 Trend of Outstanding Loan per Borrower 37

Figure 9 Trend of Clients Savings of RMDC’s POs 38

Figure 10 Trend of Savings Balance per Member 38

Figure 11 Trend of Savings-to-Loan Outstanding Ratio in POs 39

Figure 12 Trend of Operational Self Sufficiency (OSS) of POs 39

Figure 13 Trend of Staff Productivity of POs 40

Figure 14 Trend of Field Staff Productivity of POs 40

TableTable 1 Number of Staffs in Different Fiscal Years 07



ADB Asian Development BankADBN Agricultural Development Bank of NepalASKS Anannyo Saving Kalyan SansthaBoD Board of DirectorsCB Commercial BankCIP Community Irrigation ProjectCLDP Community Livestock Development ProjectCSD Centre for Self-help DevelopmentDB Development BankFIA The Financial Intermediary Act, 1998FINGO Financial Intermediary NGOsFY Fiscal Year GBB Grameen Bikas BankGBR Grameen Bank ReplicatorGoN Government of Nepal IBP Intensive Banking ProgramJFPR Japanese Fund for Poverty ReductionMCPW Micro Credit Project for WomenMFB Microfinance BankMFDB Microfinance Development BankMF MicrofinanceMFI Microfinance InstitutionMoF Ministry of FinanceNBL Nepal Bank Ltd.NGO Non-Government OrganizationNPC National Planning CommissionNRB Nepal Rastra BankNUBL Nirdhan Utthan Bank Ltd.PCRW Production Credit for Rural WomenPGT Pre-Group TrainingPOs Partner OrganizationsPRA Participatory Rural AppraisalPWR Participatory Wealth RankingRBB Rastriya Banijya Bank Ltd.RGBB Regional Grameen Bikas BankRMDC Rural Microfinance Development Centre Ltd.RMP Rural Microfinance ProjectSBB Swabalamban Bikas BankSBFIC Savings Banks Foundation for International CooperationSCC Savings and Credit CooperativeSFCL Small Farmer Cooperative LimitedSFDP Small Farmers Development ProgramSKBBL Sana Kisan Bikas Bank LimitedVDC Village Development CommitteeWDD Women Development Department

Abbreviations



Microfinance is recognized as an essential tool for women empowerment and poverty reduction especially in the low-income countries across the globe. It allows the poor and the very poor to unleash their vast potentials, increases self-employments for the low-income people, and gradually transforms the poor laborers into entrepreneurs. Microfinance is now being used as a development strategy for broad-based development in the developing world.

Institutional microcredit commenced in the country in the early 1970s, but it got a momentum particularly in the last decade due to emergence of a number of microfinance NGOs and private microfinance banks and their rapid expansion during the period in the country. The Rural Microfinance Development Centre Ltd. (RMDC) has made a substantial contribution to the expansion of microfinance outreach and to the overall growth of the microfinance industry in the country.

Microfinance has also appeared as a financially viable business if it is implemented and managed properly and professionally. Most microfinance programs are being implemented as a business for their institutional sustainability. MFIs in the country have observed that their branch offices cross financial break-even point in

Ashoke SJB RanaChairperson

Message from the Chairperson

2-3 years. The microfinance banks have also been able to provide a reasonable dividend to their investors and a bonus to their staff, and they have been adding up their financial capital each year from their operational income. Because of these promising results from the sector, microfinance is gradually getting integrated into the main stream financial system in the country.

Since microfinance is a social business, achieving social objectives is as important as attaining financial profitability. Although there has been a considerable outreach of microfinance in the country, the poor people living in remote rural areas and the hills and mountains are still deprived of or have less access to institutional microfinance services. Use of appropriate modalities of operation and necessary information technologies could facilitate cost-effective expansion of the microfinance service to the poor people in those areas. We all investors, practitioners and regulator need to make concerted efforts to increase access of quality microfinance services for all poor people living in every part of the country.

I thank you all for your kind supports and contribution to the growth of RMDC and of the microfinance industry in the country.

i





Shankar Man ShresthaChief Executive Officer

Microfinance operations in Nepal have now taken the shape of an industry. Although the history of microfinance dates back to 1975, the momentum was gained in the decade of 2000 despite unstable political condition in the country. Many MFIs have been promoted and developed through the efforts and supports of RMDC. They have grown professional and have been able to achieve operational self sufficiency within 2-3 years period of their establishment without any outside grant support. They have been successful to outreach the most deprived and disadvantaged and poorest segment of rural population. Today, the country has witnessed adequate number of microfinance institutions capable to discharge services to the widespread needy population. Many performance indicators of Nepali MFIs are positive and encouraging. Their operational efficiency is excellent. Almost all of them are making profit with interest rates significantly lower than other countries. The portfolio quality has been maintained excellent (with less than 1.5% arrears rate). Another remarkable dimension of their operations is the mobilization of internal resources i.e clients savings which is accounted to be over 40% of their outstanding loans. RMDC partner MFIS also have accounted over 1.3 million clients in 67 districts of the country. This comprises roughly 70% of the total outreach of MFIs in the country.

RMDC, from the very beginning of its operation has been trying to inculcate culture of social business among its partner MFIs through its capacity building programs so that they could transform themselves into financially viable and socially responsible institutions and become eligible for commercial funds. Although MFIs in the country have achieved very good financial performance, they seem to have gradually drifted away from their social mission. By promoting mainly credit, savings and other financial services, they inadvertently have taken focus

away from socio-economic development of the clients. MFIs compete with each other for their own growth and profitability, and pay little attention to the needs and problems of the target group – the poor and the ultra-poor. Anecdotal observations indicate that over-indebtedness among the clients and social distortions are increasing day-by-day in the program areas due to poor credit delivery practices and unhealthy competition among the MFIs resulting in multiple financing to the clients. Now it is high time to give concerted efforts from all stakeholders- donors, investors, regulators, policy makers and practitioners - to appropriately design and deliver safe, sensible and sustainable microfinance services for sustainable growth of the microfinance industry which could create higher development impact as well as make significant contribution to socio-economic development of the weaker segment of the population.

I would like to take this opportunity to convey my thanks to the Government of Nepal, the Nepal Rastra Bank and other development agencies for their support. I express my sincere thanks to all the members of the General Body and the Board of Directors of RMDC for their valuable guidance and support. I also thank our partner MFIs for joining hands with RMDC in delivering quality microfinance services in the country. I appreciate the commitment and hard work of all RMDC personnel. Finally, I would like to thank media for their constructive roles in popularizing microfinance in the country.

iii

Reflections of the Chief Executive Officer



The Rural Microfinance Development Centre Ltd. (RMDC) is a wholesale lending organization in Nepal. It was registered on 30 October 1998 under the then ‘Company Act, 1996’ as a public limited company with the mandate to operate as a wholesale lending organization within the framework of the then ‘Development Bank Act, 1995’. RMDC was reregistered under the current unified banking law, the ‘Bank and Financial Institution Act (BFIA), 2006’ as a class ‘D’ financial institution. RMDC commenced its lending operation from January 2000. The main function of RMDC is wholesale lending to MFIs. Besides, it has been extending institutional capacity building supports to MFIs. Currently, RMDC is one of the prominent wholesale lending organization for MFIs in the country. Its partners’ outreach shares nearly 70% of the entire microfinance industry’s business in the country.

The main objective of RMDC is to improve the socio-economic conditions of the poor, the landless and the assetless through increasing their access to institutional microfinance services for productive undertakings and self-employments. The specific objectives of RMDC are:

• to provide wholesale funds to microfinance institutions (MFIs) for on-lending to the poor, particularly the women of those families, for undertaking productive activities;

• to build and strengthen institutional capacities of its partner MFIs as well as potential institutions willing to implement microfinance program;

• to promote financially viable and sustainable MFIs by providing adequate wholesale funds and necessary technical supports to the existing as well as potential microfinance institutions including NGOs and cooperatives;

• to support or undertake studies and research works in products and services, impact, delivery and recovery system, innovation etc;

• to assist POs and potential POs in improving organizational capacities and occupational skills of their clients; and

• to play the role of a financial intermediary to channelize international and national resources to the poor (the ultimate beneficiaries).

RMDC has completed fourteen years of its operation and has been providing

Introduction

01


The Partner for Safe, Sensible & Sustainable Microfinance 02

microfinance services to more than 1.3 million poor families through its 102 partner organizations (POs).

RMDC exercised an extensive institution hunt and identified over 200 institutions (NGOs and Cooperatives) having potentials of implementing microfinance program. RMDC made all out efforts to build and strengthen institutional capacities and to up-grade human resources of the institutions willing to commence microfinance operation. It organized various need-based capacity building programs, such as on-the-job training, on-site technical assistance, class-room training on different subjects, study visits and interactive workshops. The subject areas covered followings:

• principles of microfinance, • modalities of microfinance operations, • financial analysis and delinquency

management, • credit appraisal, • credit management, • group dynamics, • facilitation skills, • business planning, • management information systems, • accounting and book keeping, • branch management, • training methodology, • internal control and audit, • monitoring and supervision, etc.

By the end of fiscal year 2011/12, RMDC had already provided training to 16,541 staffs and officials, and 580,230 clients of MFIs. As a result, in about more than a decade, over hundred MFIs have developed their capacities required to operate their microfinance programs in a sustainable manner. Till now, it has overcome various challenges and it learnt valuable lessons and converted them into opportunities. As a natural process microfinance programs are moving towards maturity. General people are now aware of the importance of microfinance programs and they are being enhanced as viable financial programs in the country capable of serving the needs of the large masses.

Districts Covered 67

Partner Organizations 102

Loan Approved (NRs.) 7.76 billion

Loan Disbursed (NRs.) 6.82 billion

Loan Recovered (NRs. ) 4.92 billion

Outstanding Loan (NRs.) 1.91 billion

Non-Performing Assets (NRs.) Nil

Loan Repayment Rate 100%

Loan Loss Reserve Rate 4%

Operational Self Sufficiency 266%

Yield on Loan Portfolio 9%

Return on Equity 14%

Return on Assets 4%

Capital Adequacy 32%

No. of MFI staffs trained 16,541

No. of MFI clients trained 580,230

No. of institutions receiving training 244

Box 1: RMDC’s Progress at a GlanceAs of July 15, 2012


The Partner for Safe, Sensible & Sustainable Microfinance03

Corporate Governance

General BodyThe General Body is the supreme authority of RMDC. It consists of representatives from 21 promoter shareholding institutions, which include the Nepal Rastra Bank, 13 commercial banks, five Regional Grameen Bikas Banks (GBBs), the Deposit and Credit Guarantee Corporation and the Nirdhan Utthan Bank Ltd. The General Body through Annual General Meeting, gives overall policy guidelines and directions to the Board of Directors and the management for smooth functioning of the Centre. The Body approves audited financial statements, appoint an auditor and fix audit fee, select the Board of Directors, makes required amendment in the Memorandum of Association and the Article of Association and takes other key policy decisions of the organization.

Board of DirectorsThe Board of Directors of RMDC is represented

by seven non-executive directors. Among the seven directors - one represents the Nepal Rastra Bank (NRB), five represent the shareholder commercial banks and one independent professional. The Chairperson of the Board is elected from among the members of the Board. All the directors including chairperson has a four year term. The Board has collective responsibility of providing leadership to RMDC. The Board formulates necessary policies and procedures and issue directives to the management to pursue successful implementation of plans and programs and achieve organizational goals and objectives. It is basically involved in making decisions with regard to business plan, annual program and budget, financial and operational plan, approval of larger amount of loan to MFIs. It also conducts review of the organization’s performance, and oversees statutory and regulatory compliance and the matters related to capital structure of the organization.



Board

of

Dir

ecto

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Board Members’ Profile

Mr. Ashoke SJB Rana Chairperson

Mr. Rana represents the Himalayan Bank Limited. He is the Chief Executive Officer of the Bank. He is also the President of the Nepal Bankers’ Association. He holds a bachelor’s degree in Economics from the George Mason University, Fairfax V. A., USA. He has over 20 years of work experience in commercial banking.

Mr. Manmohan Kumar Shrestha

Director

Mr. Shrestha represents the Nepal Rastra Bank (the central bank of Nepal). He holds the position of the Executive Director of the Corporate Planning Department of NRB. He possesses the degree of M.A. Economics from Tribhuvan University of Nepal. He has already completed 25 years of service in the Bank.

Mr. Anil Kumar Shrestha Director

Mr. Shrestha represents the Standard Chartered Bank Nepal Ltd. He works as a head of Financial Institutions Organization & Client Coverage in the bank. He holds a Master degree in Business Administration (MBA). He has worked for 15 years in banking sector.



Mr. Anil Kumar Khanal Director

Mr. Khanal represents Nabil Bank Ltd. He works as the Chief Risk Officer in the bank. He has an MBA degree from Tribhuvan University, Nepal. He has over 24 years of working experience in the banking sector.

Mr. Rajan Kumar Amatya Director

Mr. Amatya represents the Nepal Investment Bank Ltd. He works as the Deputy General Manager in the bank. He holds a master’s degree in Commerce from Tribhuvan University of Nepal and worked for over 35 years in the banking sector of Nepal.

Mr. Kiran Kumar Shrestha Director

Mr. Shrestha represents Nepal Bank Ltd. He works as the General Manager in the bank. He has an MPA degree from Tribhuvan University, Nepal. He has over 25 years of working experience in the bank.

Ms. Sadhana Upadhyay Director

Ms. Upadhyay is an independent professional director. She has an MBA degree from University of the East, Manila and 30 years of work experience with the Nepal Rastra Bank.



Audit CommitteeThe Audit Committee comprises of three non-executive directors of the Board. The Committee reviews internal audit reports, external audit report, NRB Inspection report, financial performance reports of RMDC. Based on the reviews and findings, the Committee, provides necessary recommendations and guidance to the management for necessary improvements in operation and makes suggestions to the Board for policy changes or improvements. The internal auditor, who is the head of Internal Audit Department of RMDC, submits its internal audit reports directly to the Audit Committee.

ManagementRMDC is led by the Chief Executive Officer (CEO) with different department heads responsible for carrying out day-to-day activities. The CEO is assisted by a number of experienced and professional staff to carry out departmental functions. Including the CEO, RMDC has a total of 25 staffs -18 professional staffs and 7 support staffs (see Table 1). RMDC has maintained thin

staffing from the very beginning of its operation with a view to reducing cost and attain high operational efficiency.

Fiscal Year

Professional Staff*

Support Staff

Total Staff

1999-00 7 4 11

2000-01 8 4 12

2001-02 8 4 12

2002-03 7 4 11

2003-04 7 5 12

2004-05 9 5 14

2005-06 12 6 18

2006-07 12 6 18

2007-08 15 6 21

2008-09 15 6 21

2009-10 16 7 23

2010-11 16 7 23

2011-12 18 7 25

• Includes the Chief Executive Officer

Table 1: Number of Staffs in Different Fiscal Years

Management Team



Board of Directors

Audit Committe

Chief Executive Officer

MicrofinanceService

Department

Supervision Department

FinancialManagementDepartment

Human Resource

ManagementDepartment

Institutional & Social

Development Department

Planning & Research

Department

Internal Audit Department

Organization Structure



Report of the Board of Directors

On behalf of the Board of Directors, I would like to welcome all the delegates of the shareholder organizations at this Fourteenth Annual General Meeting of the Rural Microfinance Development Centre Ltd (RMDC).

The Centre completed fourteen years of operation successfully on October 29, 2012. It has been implementing strategic programs on microfinance to promote stable and steady growth of microfinance operations in the country. On this occasion, I would like to briefly highlight the status, progress and financial position of the Centre for the fiscal year 2011-12 and the programs in the current fiscal year.

1. Overview of the Economy

The country has been facing sluggish economic growth for many years due to political instability, union militancy, strike, lock up etc in one hand and stagnation in investment in the productive sector on the other. However, remittance income has been increased significantly

mainly because of a sharp increment in the number of people going abroad for foreign employment, a rise in the salary of workers in the destination countries and depreciation of Nepalese currency vis-à-vis the US dollar. There was also a noticeable price rise in food and consumer good, with inflation rate nearing double digits in recent years.

Poverty is the main challenge to the economy and the development in the country. In order to attain sustainable growth, the poor and the vulnerable should have access to finance and employment. Microfinance programs have been introduced in Nepal with the aim of assisting the poor and providing them with financial access for self-employment. Many MFIs have been established in the last decade and financial services are being expanded to the masses. The availability of funds to MFIs has been easy due to the raise of the limit of deprived sector financing of banks and financial institution by the Nepal Rastra Bank each year.

09



2. Change in Capital Structure

In FY 2010/11, the authorized capital, issued capital and paid up capital has been increased to Rs.1 billion, Rs.520 million and Rs.520 million respectively in accordance with the decision of 11th annual general meeting of the Centre. The issued and paid up capital of Rs. 320 million has remained the same as in the previous year due to the non-issuance of the share capital to the general public as yet.

3. Change in the Board of Directors

In the FY 2011/12 out of the seven members of the Board of Directors, Mr. Anil Kumar Khanal has been nominated in the place of Mr. Amrit Charan Shrestha as the representative of the Nabil Bank Limited. On behalf of the Board and myself I would like to express my sincere appreciation and thanks to the former board member Mr. Amrit Charan Shrestha for his valuable contribution to the Centre. In the FY 2011/12, eleven board meetings were held and important decisions were taken including approval of annual program and budget and periodic reviews of the Centre’s performance.

4. Audit Committee

The audit committee comprising three members of the Board of Directors-Mr. Manmohan Kumar Shrestha as the coordinator and Mr. Rajan Kumar Amatya & Mr. Anil Kumar Shrestha as the members. In the FY 2011/12, three committee meetings were held. They reviewed financial statements of the Centre for their correctness, checked internal control and

risk management system, provided necessary directions to the Management and also rendered suggestions to the Board of Directors on related policy matters.

5. Internal Control System

With the aim of making the Centre’s internal control system effective, an Internal Audit Department has been created. The department performs auditing of the Centre’s operational activities on a half-yearly basis. During the internal audit, every transaction is examined and suggestions are given to the respective department for correction. After the internal audit, a detailed report is prepared and submitted directly to the Audit committee.

6. Follow up of the Partner OrganizationsAs the Centre has been providing loans to the microfinance institutions without taking physical collateral securities, it has also been performing its follow up and monitoring functions with a high priority. This has facilitated improvements in the operations of the partner organizations and thereby helped them to improve their shortcomings and move towards achieving financial self-sufficiency. Most partner MFIs have been found following good governance norms set out by NRB and the Department of Cooperatives.

7. Planning and Research

The Planning and Research Department is entrusted with the responsibility to formulate annual plans and programs, business plan, keep MIS, review of annual programs and



operations, make mandatory reporting to NRB and conduct research and studies in the related field of microfinance. It functions in cooperation and coordination with other departments and prepares periodic progress reports of the Centre and also receives the periodic reports from the POs and compiles, analyzes and submits them to the Management and the Board of Directors and other concerned agencies.

8. Human Resource Management

The Centre has been adopting a rational staff recruitment policy maintaining optimum productivity of the employees from its inception to avoid unnecessary expenses. The Centre has now been functioning with 25 employees including the Chief Executive Officer. In the FY 2011/12, five employees have been given promotion to higher post. The Centre has been providing various training to its staff both in national and international institutions for upgrading their knowledge and skills.

9. Progress and Achievements

a. Loan Disbursement and Outreach

Expansion

In the FY 2011/12, the Centre has disbursed Rs.1.01 billion to its partner MFIs. Since its inception to FY 2011/12, it had approved loans amounting to Rs. 7.76 billion to 102 MFIs and disbursed Rs. 6.82 billion to 94 MFIs. These MFIs have been providing microfinance services to more than 1.3 million poor households in 67 districts of the country. The Centre has been able to collect back 100 percent of its loan and interest dues from its partner organizations

on time. It had an outstanding loan balance of Rs.1.91billion at the end of the FY 2011/12. The Centre’s disbursement has been constrained due to easy and low cost supply of fund from banks and financial institutions to meet the mandatory requirement of the deprived sector finance.

b. Institutional Development of MFIs

and Training Programs

With the objective of developing institutional capacities of MFIs, the Centre has been organizing several seminars, workshops and training programs so as to assist the institutional development of MFIs and the capacity building of their officials, staff and clients.

The Centre had organized four regional level annual review workshops of its partner MFIs to review the progress and performance of MFIs and sharing experiences and innovations among themselves. The Centre had also organized training programs on micro-enterprise financing, internal audit and inspection, financial analysis and delinquency management, micro business simulation, training of trainers on micro business etc. Besides, RMDC facilitated 19 one-day interactive workshops for field staff of POs. In the FY 2011/12 a total of 1,133 staff and officials had participated in 42 training programs. Till the end of the FY 2011/12, the Centre provided training to 16,541 staff and officials of MFIs. These training supports along with monitoring and follow up of the Centre have significantly enhanced the capacities of the partner MFIs. The POs now have 797 branches and 4,289 staff to discharge services to the masses.

It also organized one conference of the members of partner MFIs of the mid and far-western development regions. With funding support of RMDC, the POs have implemented a large number of clients training programs such as skill development training, center chief’s workshops, pre-group and refresher training for clients. In the FY 2011/12 a total of 55,110 clients had participated in various training programs. Till the end of the FY 2011/12, the Centre

11



provided training supports to 580,230 clients of the partner MFIs.

10. The State of Microfinance

Microfinance sector now has grown as an industry with significant increase in the number of MFIs and outreach services to the poor and deprived. Till now it is estimated that over 1.7 million deprived families have been served by the microfinance institutions. Over 1.3 million poor families have been served by RMDC’s partner MFIs alone.

With technical, financial and capacity building supports of RMDC, microfinance institutions are becoming more professional and equipped with trained human resources to implement microfinance programs successfully. Microfinance has helped women to be economically and socially empowered. It has not only helped them to generate income but also change their living conditions and enabled them to provide education to their children, better housing condition, eat nutritious foods and have better clothing for their families. Due to the special modality of the microfinance operation, it could not only reach out to the poor, but also facilitate them to make the best use of their money and pay off the loans in time. However the concentration of MFIs’ services in the urban and semi urban, and easy to reach areas of the hills and terai region has tremendously increased multiple financing resulting in over–indebtedness of the borrowers and finally raising their own credit risk. All the concerned agencies and MFIs are urged to take concerted efforts to address this problem urgently before it spirals out of control causing damage to the credibility of microfinance.

MFIs officials have to be more responsible towards clients as they are the major stakeholders and mission drivers of the organizations. The MFIs should go for responsible microfinance and adhere to good governance practices. Those who have already been successful financially should utilize a part of their earnings for the social upliftment of the borrowers and provide credit plus services as well. Microfinance Institutions which have been running in profit have to expand their activities to the remote hills and mountains areas, where there are virtually no presence of microfinance providers as yet.

11. Financial Condition of the CentreWith regard to the financial condition of the Centre, in the FY 2011/12 the total income stood at Rs. 356.78 million, which has been increased by 21.5 percent over the FY 2010/11. The total expenses have increased by 46.3% as compared to the previous year. It stood at Rs.142.70 million. The total expenses of the Centre scaled up in FY 2011/12 due to additional provision made for the deposit in a problematic finance company as directed by NRB. As per the Bonus Act, 10% staff bonus amounting Rs.19.46 million has been provisioned out of the profit before bonus and tax. The corporate tax at the rate of 30% amounting Rs.58.09 million has been provisioned out of the profit after bonus. The Net-Profit-After-Tax stood at Rs.136.52 million out of which 20 percent amounting Rs.27.30 million has been appropriated to the Compulsory General Reserve and Rs.2.00 million have been allocated for ‘the Microfinance Development Fund’. As the initial public offering has not yet been concluded, the dividend for the shareholders is not proposed. The remaining balance of Rs. 89.12 million has been transferred to the Balance Sheet.

12. Current Year’s ProgramNow, I would like to briefly highlight the Centre’s major programs that would be undertaken in the current fiscal year.

a) The Centre will complete the process of issuing 30% shares to general public and Rs. 44 million to institutional shareholders group ‘B’ after which the paid up share capital of the Centre will reach Rs. 520 million from Rs. 320 million.



b) There will be a continuation of the wholesale lending to the MFIs after appraising their performances and institutional capabilities.

c) The Centre will extend capacity building and institutional development supports to prospective and existing MFIs of project districts under Community Irrigation Project funded by the Asian Development Bank.

d) The microfinance programs for the poor living in the hills and mountains will be further expanded. To this effect, it will develop cooperatives as new MFIs and enroll them as partners.

e) The Centre has set a goal of reaching out to a total of 1450 thousand poor families with microfinance services by the end of the current fiscal year, through extension of the services to additional 117 thousand poor families in this year. The Centre will identify new partner MFIs and disburse small loans encouraging the MFIs to lend loans of small size to reach the poor and unserved population.

f) The Centre will continue to extend capacity building support to its partner organizations from its own resources and conduct reviews of various training, workshops and seminars for further improvements in future. It will also continue to sensitize MFIs on overindebtedness of clients caused by the overlapped lending of MFIs through regular dialogue and intensive monitoring and follow up of their operations.

g) The Centre also plans to extend micro enterprise loans to graduated clients of MFIs and to other individual micro entrepreneur clients of savings and credit cooperatives focusing on the unemployed youth. As there is difficulty in augmenting microfinance services in the hills and remote areas due to the very limited number of microfinance institutions in such

areas, the Centre will identify potential local cooperatives and provide financial and technical support for developing their institutional capacities to discharge microfinance services in their respective areas.

h) The Centre will participate in the initiations taken by some capable financial intermediary NGOs and cooperatives to transform themselves into microfinance banks within the regulatory frame work and directives of the Nepal Rastra Bank after assessing their performance and viability.

i) The Centre plans to organize a follow up Conference of MFIs to review the performance of MFIs on the goal set by MFIs for the year 2015 and chalk out strategies to accelerate outreach coverage and control distortions in the market. It also plans to organize a national level conference of MFIs members to facilitate exchange of experiences and innovations among members and MFIs officials.

13. Vote of Thanks

Lastly, I would like to express my sincere gratitude to all shareholder institutions, the Government of Nepal, the Nepal Rastra Bank, the Asian Development Bank and the Centre’s partner organizations for their cooperation. On behalf of the Board of Directors, I would also like to place on record my heartfelt thanks to the Chief Executive Officer and the staff of the Centre for their contribution to the growth and professional development of the Centre and the microfinance sector. Likewise, I am grateful to the media for their coverage of the Centre’s activities and to all the other well-wishers of the Centre. As usual, I look forward to receiving your valuable suggestions and supports for improving the operational capacity and service quality of the Centre in the future as well.

Thank You!

ChairmanBoard of DirectorsKathmandu

13



A V

iew

of

Cen

ter

Mee

ting



Auditor’s Reportand

Financial Statements



INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF

RURAL MICROFINANCE DEVELOPMENT CENTRE LTD.

SUNDAR & CO.Chartered Accountants

Pulchowk (Machagaa),Lalitpur 20/8 Gha.P.O.B 3102 Kathmandu, Nepal

Phone No. (977-1) 5521804 /5529942Fax: 977-1-5524804Email: [email protected]

Report on the Financial Statements

We have audited the accompanying financial statements of Rural Microfinance Development Centre Ltd, which comprise the balance sheet as at 31st Ashadh 2069 corresponding to 15th July 2012, and the profit & loss account, statement of changes in equity and cash flow statement for the year then ended, and a summary of significant accounting policies and other explanatory notes.

Management’s Responsibility for the Financial StatementsManagement is responsible for the preparation and fair presentation of these financial statements in accordance with Nepal Accounting Standards so far as applicable in compliance with prevailing Acts and laws. This responsibility includes: designing, implementing and maintaining internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances.

Auditors’ ResponsibilityOur responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with Nepal Standards on Auditing. Those standards require that we comply with relevant ethical requirements and plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on our judgment, including the assessment of risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, we consider internal control relevant to the company’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Report on Other Legal and Regulatory Requirements (Bank and Financial Institution Act and Company Act)

On examination of the financial statements as aforesaid, we report that:

a. We have obtained all information and explanations asked for, which to the best of our knowledge and belief were necessary for the purpose of our examination.

b. In our opinion, proper books of account as required by law have been kept by the company, in so far as appears from our examination of those books of account and the financial statements dealt with by this report, prepared in the format prescribed by Nepal Rastra Bank, are in agreement with the books of accounts.

c. In our opinion, the returns received from the respective branches are adequate for the audit purpose, though the statements are independently not audited.

d. In our opinion and to the best of our information and according to the explanations given to us and from our examination of the books of account of the company, we have not come across the cases where the Board of Directors or any member thereof or any employee of the company has acted deliberately contrary to the provisions of the law relating to accounts or caused loss or damage to the company or committed any misappropriation or violated any directive of Nepal Rastra Bank or acted in a manner to jeopardize the interest and security of the company and its depositors

e. In our opinion, adequate capital fund and provisions for losses have been made and the business of the company has been conducted within its authority.

Opinion on the financial Statements In our opinion and to the best of our information and according to the explanations given to us, the said financial statements referred to above, read together with the notes attached thereon give a true and fair view of the financial position of the company as of Ashadh 31st, 2069 (July 15th, 2012), and of the results of its financial performances and its cash flows for the year then ended in accordance with Nepal Accounting Standards so far as applicable in compliance with the prevailing Laws.

Sundar Man Shrestha, FCAChartered AccountantPartnerSundar & Co.

Date: November 18, 2012



Balance SheetAs at Asar 31, 2069 (As at July 15, 2012)

Capital and Liabilities Schedule This Year (Rs) Previous Year (Rs)1 Share Capital 4.1 320,000,000.00 320,000,000.00

2 Reserve and Funds 4.2 699,788,615.27 565,268,670.19 3 Debenture and Bonds 4.3 - - 4 Borrowings 4.4 2,555,161,884.58 2,312,701,228.84 5 Deposit Liabilities 4.5 - - 6 Bills Payables 4.6 - - 7 Proposed and Dividend Payables - 8 Income Tax Liabilities 73,245,455.00 54,112,678.00 9 Other Liabilities 4.7 102,628,675.26 37,955,332.10

Total Liabilities 3,750,824,630.11 3,290,037,909.13

Assets Schedule This Year (Rs) Previous Year (Rs)1 Cash Balance 4.8 2,899.00 4,508.80

2 Nepal Rastra Bank Balance 4.9 29,176,433.57 14,948,190.06 3 Bank Balance 4.10 363,347,269.27 183,889,848.62 4 Money at Call and Short Notice 4.11 - - 5 Investments 4.12 1,402,865,408.00 860,348,465.00 6 Loan Advances and Bills Purchase 4.13 1,829,257,152.00 2,151,263,136.00 7 Fixed Assets 4.14 2,345,434.73 2,414,444.91 8 Non Banking Assets 4.15 - 9 Other Assets 4.16 123,830,033.54 77,169,315.74

Total Assets 3,750,824,630.11 3,290,037,909.13

Megh Raj GajurelSenior Manager (FMD)


Ashoke SJB RanaChairman

Directors:Manmohan Kumar ShresthaAnil Kumar ShresthaRajan Kumar AmatyaKiran Kumar ShresthaAnil Kumar KhanalSadhana Upadhyay

As per our attached report of even date

Sundar Man Shrestha, FCA

Sundar & Co.



Profit and Loss AccountFor the period Shrawan 1, 2068 to Asar 31, 2069 (July 17, 2011 to July 15, 2012)

Particulars Schedule This Year (Rs) Previous Year (Rs)

1 Interest Income 4.18 331,567,751.73 282,494,749.98

2 Interest Expenses 4.19 72,381,307.29 60,441,337.48

Net Interest Income 259,186,444.44 222,053,412.50

3 Commission and Discount 4.20

4 Other Operating Income 4.21 11,793,582.51 11,206,047.73

5 Foreign Exchange Income 4.22 -

Total Operating Income 270,980,026.95 233,259,460.23

6 Personnel Expenses 4.23 18,270,838.69 15,830,568.44

7 Other Operating Expenses 4.24 6,466,930.05 8,495,314.44

8 Foreign Exchange Losses 4.22 -

Operating Profit before Loss Provision 246,242,258.21 208,933,577.35

9 Provision for Losses 4.25 45,583,096.66 12,748,052.00

Operating Profit 200,659,161.55 196,185,525.35

10 Non-Operating Gain/Loss 4.26

11 Reversed from Loan Loss Provision 4.27 13,416,916.00

Profit from Regular Operations 214,076,077.55 196,185,525.35

12 Extraordinary Operational Gain/Loss 4.28

Net profit from Whole Operation 214,076,077.55 196,185,525.35

13 Provision for Employees Bonus 19,461,461.60 17,835,047.76

14 Income Tax Provision 58,094,670.87 53,531,693.19

● This year 73,245,455.00 54,112,678.00

● Previous Year 133,291.00 6,872.00

● Deferred Tax Income/Expense (15,284,075.13) (587,856.81)

Net Profit/Loss 136,519,945.08 124,818,784.40







Sundar & Co.



Profit and Loss Appropriation AccountFor the period Shrawan 1, 2068 to Asar 31, 2069 (July 17, 2011 to July 15, 2012)

Particulars This Year (Rs) Previous Year (Rs)

Income

1 Retained Earning up to Previous Year 179,123,441.58 82,168,770.87

2 Deferred Tax Reserve up to previous Year -

3 Net Profit of This year 136,519,945.08 124,818,784.40

4 Exchange Equalization Fund

Total 315,643,386.66 206,987,555.27

Expenditure

1 Net Retained Losses up to Previous Year

2 Net Losses of Current Year

3 General Reserve Fund 27,304,255.80 24,963,756.88

4 Contingent Reserve Fund

5 Microfinance Development Fund 2,000,000.00 2,000,000.00

6 Dividend Equalization Fund

7 Employee Related Fund - -

8 Proposed Dividend - -

9 Proposed Bonus Share Issue

10 Special Reserve Fund

11 Exchange Equalization Fund

12 Capital Redemption Fund

13 Capital Adjustment Fund

14 Previous Years Tax Adjustment

15 Deferred Tax Reserve 15,284,075.13 587,856.81

16 Investment Adjustment Fund 2,812,500.00 312,500.00

Total 47,400,830.93 27,864,113.69

17 Retained Earning/(Loss) 268,242,555.73 179,123,441.58







Sundar & Co.



Cash Flow Statement For the period Shrawan 1, 2068 to Asar 31, 2069 (July 17, 2011 to July 15, 2012)

Particulars This Year (Rs) Previous Year (Rs)(A) Cash Flow from Operating Activities

1 Cash Inflow 343,361,334.24 293,700,797.71 1.1 Interest Income 331,567,751.73 282,494,749.98 1.2 Commission and Discount Income - - 1.3 Foreign Exchange Transaction Income - - 1.4 Income from Loan Write-off - - 1.5 Other Income 11,793,582.51 11,206,047.73 2 Cash outflow (187,897,695.98) (156,631,488.15)2.1 Interest Expense (72,381,307.29) (60,441,337.48)2.2 Personnel Expense (18,270,838.69) (15,830,568.44)2.3 Office Operating Expense (6,444,635.05) (8,474,231.44)2.4 Income Tax Payment (71,339,453.35) (54,050,303.03)2.5 Other Expense (19,461,461.60) (17,835,047.76)

Cash Flow Before changes in Working Capital 155,463,638.26 137,069,309.56 Increase and Decrease in Current Assets (218,064,701.32) (148,798,142.23)

1 Increase and Decrease in Money at Call and Short Notice - - 2 Increase and Decrease in Short Term Investments (539,204,443.00) 167,174,828.00 3 Increase and Decrease in Loan and Bills purchase 335,422,900.00 (318,701,300.00)4 Increase and Decrease in Other Assets (14,283,158.32) 2,728,329.77

Increase and Decrease in Current Liabilities 9,884,769.31 9,012,520.78 1 Increase and Decrease in Deposits - - 2 Certificate of Deposits - - 3 Increase and Decrease in Short-term Borrowings - - 4 Increase and Decrease in Other Liabilities 9,884,769.31 9,012,520.78

(B) Cash Flow from Investing Activities (3,946,909.82) (1,083,510.73)1 Increase and Decrease in Term Investments (3,312,500.00)2 Increase and Decrease in Fixed Assets (634,409.82) (1,083,510.73)3 Income from Long term Investments - - 4 Dividend Income5 Others - -

(C) Cash Flow from Financing Activities 250,347,257.93 59,790,000.00 1 Increase and Decrease in Long Term Borrowings (Bond, Debenture etc.) 242,460,655.74 103,390,000.00 2 Increase and Decrease in Share Capital3 Dividend Payment - (41,600,000.00)4 Increase and Decrease in Other Liabilities 7,886,602.19 (2,000,000.00)5 Increase and Decrease in Subsidized / Refinance Loans from NRB - -

(D) Income/Loss from change in Exchange Rate in Cash and Bank Balance - - (E) Cash from Total Activities of the year 193,684,054.36 55,990,177.38 (F) Opening Cash and Bank Balance 198,842,547.48 142,852,370.10 (G) Closing Cash and Bank Balance 392,526,601.84 198,842,547.48







Sundar & Co.



Wholesale Lending to Microfinance Institutions

Progress of Lending ProgramRMDC is the premier wholesale lending institution for microfinance in Nepal. It approved Rs. 7.76 billion and disbursed Rs. 6.82 billion of

loan amount to 102 retail MFIs operating in 67 districts of the country till mid-July 2012. The borrowing institutions include 7 microfinance development banks (MFDBs), 9 development banks (DBs), 24 financial intermediary NGOs (FI-NGOs) and 62 cooperatives.

RMDC has been maintaining an excellent loan portfolio quality with a hundred percent loan recovery rate since inception till date. Its loan outstanding with its partner organizations (POs’) stood at Rs. 1.91 billion at the end of the fiscal year 2011/12. The annual portfolio growth of last five years has been portrayed in the figure 1 below.

RMDC has also been making all out efforts to expand microfinance operations in the hills and mountain areas by identifying potential institutions and building up their capacities. The provision of small loan funds at a lower

Figure 1: Annual Portfolio Growth of RMDC2400

2200

2000

180016001400

12001000800

600

400200

0Jul-08 Jul-09 Jul-10 Jul-11 Jul-12

Annual Disbursement 525 845 1202 1298 1009 Annual Recovery 406 600 780 979 1345 Outstanding 1254 1500 1922 2241 1905

Rs. i

n M

illion

21



interest rate has motivated them to initiate microfinance operation in their surrounding villages. They are monitored and supervised to ensure that the operations of these start-up institutions’ are going on right track. RMDC also encourages its current partners to expand their microfinance operation in the hitherto un-served areas by providing them with one million rupees of loan fund per branch at 2% annual interest rate. In the reporting fiscal year, RMDC has elongated its operation through its existing and new partners to 10 new hill districts - Kalikot, Khotang, Bajhang, Baitadi, Darchula, Bhojpur, Sankhuwasabha, Tehrathum, Taplejung and Okhaldunga.

Loan Products RMDC offers a number of loan products to retail MFIs such as i) Microfinance Operation Loan, ii) Micro-enterprise Loan, iii) Microfinance Promotion Loan, iv) Bridge Loan, v) Special Loan and vi) Seed Fund Loan. They have been briefly described below.

Microfinance Operation Loan

It is the main loan product of RMDC offered to retail MFIs. The purpose of the loan is to finance a broad range of income-generating activities of the ultimate borrowers who mainly comprise the poor women who need relatively less amount of loans for initiating income generating activities. RMDC charges an annual interest rate of 7% on this loan. With this loan fund, an MFI may disburse up to Rs.100,000 to a woman borrower as per the client’s need and capacity.

Micro-enterprise Loan

It is offered to the partner MFIs which have sizeable number of clients having adequate capacities of utilizing bigger loans for micro and small enterprises (MSEs). The annual interest rate charged by RMDC on this loan is 7.5%. Receiving this loan fund, the MFI disburses relatively a bigger size loan to the graduated clients, maybe upto Rs. 300,000, taking physical collateral.

Microfinance Promotion Loan

The main purpose of the Microfinance Promotion Loan is to promote small microfinance institutions to commence microfinance operations. This loan product is targeted at the MFI which have not outreached over 10,000 clients yet and have not borrowed any loans from any other banks or financial institutions except from the Nepal Rastra Bank (the central bank of Nepal). RMDC charges an annual interest rate of 7% on this loan.

Bridge loan

This is a short term loan provided to a current partner MFI to fulfill an urgent need of fund while its loan application for a new loan (which is relatively bigger than the bridge loan) is under the process of approval at RMDC. This loan is later adjusted with the main loan, once it is approved and disbursed. The maximum amount of this type of loan an MFI can obtain is 20% of its outstanding loan amount with RMDC, and the term of this loan product is up to six months. To avail this loan facility, RMDC requires the partner MFIs to have fulfilled the following conditions as well:

• have properly utilized at least three loan facilities in the past from RMDC;



• have submitted a loan application for a new loan;

• have an enough net-worth for the additional loan;

• have maintained a good track record of loan repayment in the past; and

• have maintained a good financial health.

Special loan

RMDC has introduced this loan product to solve a liquidity problem of its partner MFIs. A partner MFI of RMDC can apply for this loan facility as and when it needs and can repay the whole loan amount in one installment or in a number of installments within its maximum term of one year. The amount of this loan an MFI can obtain is upto 10% of its current loan outstanding with RMDC. To avail this loan facility, partner MFIs

should have already utilized at least five loan facilities from RMDC and have fulfilled all those criteria required for borrowing a Bridge loan.

Seed Fund Loan

In view of the very limited access to microfinance services for the people living in the remote hills and mountains of the country, RMDC has launched a seed fund loan scheme for nineteen hills and mountain districts in the country namely Achham, Bajhang, Bajura, Bhojpur, Darchula, Dolpa, Humla, Jajarkot, Jumla, Kalikot, Khotang, Manang, Mugu, Mustang, Okhaldhunga, Sankhuwasabha, Solukhumbu, Taplejung and Tehrathum. Under this scheme, RMDC provides a loan fund up to one million rupees to a local microfinance cooperative or an MFI branch which is operating in any of these aforementioned districts. RMDC charges just a 2% annual interest rate on this loan. It is hoped that this soft loan will help an MFI to meet at least two local staff cost and have a marginal surplus to conduct its operation. Besides, RMDC deploy a number of teams to these districts to identify potential cooperatives for initiating microfinance operation. The team, after investigating the viability of the potential applicant institutions, can approve an initial loan on the spot. The loan documents are also completed and signed by the respective authorities on the spot so that they don’t have to travel to RMDC’s office in Kathmandu, this

1 MFDBs are class ‘D’ banks as per ‘Bank and Financial Institution Act (BFIA), 2006’ and are established solely for microfinance operation.

2 Development Banks are class ‘B’ banks as per the ‘BFIA, 2006’

23



reduces the MFIs’ borrowing cost substantially. At the same time, RMDC field team imparts onsite orientation to the officials and staff of the cooperatives on the basic of microfinance operation and accounts and record keeping.

Process of Lending to MFIs• RMDC offers wholesale loan funds to

institutions having a legal license to implement microfinance program, such as specialized microfinance development banks (MFDBs)1, savings and credit cooperatives (SCCs) and financial-intermediary NGOs (FI-NGOs) or any financial institution willing to and legally allowed to implement a microcredit program. RMDC provided loan funds to some development banks2 for financing small scale livestock farming and the related enterprises under the Community Livestock Development Project (CLDP) funded by the Asian Development Bank. Some other development banks (Class ‘B’ bank) also have been financed for regular microfinance operation in their respective areas.

• For a loan fund, an eligible MFI submits a loan application along with a set of required documents to RMDC. (The criteria

for determining an institution’s eligibility for borrowing from RMDC are given in Box 2.) After receiving a completed loan application, RMDC makes off-site and on-site investigations of the applicant institution. After making a detailed appraisal of the institution, the decision of loan approval or disapproval is taken (See Box 3 for the key parameters of RMDC’s appraisal). Business plan and institutional capacities of the MFIs are also taken into account while determining loan size and repayment schedule. After agreeing on the necessary terms and conditions by the applicant MFI and signing of the legal documents by both parties, RMDC releases the approved amount in installments.

• RMDC makes off-site and on-site monitoring and follow ups of the loanee MFIs to ensure that the disbursed loans are properly utilized by the MFI and the institution’s overall loan program as well as financial progress are on right track.

• RMDC charges an annual interest rate of 2-9% on its loans disbursed to MFIs. The loanee MFIs are free to set their own lending rate to their clients. However, RMDC advises them to have an appropriate interest rate so as to meet their financial

An organization willing to borrow a loan from RMDC should fulfill the following requirements: i. Possesses a valid license for microfinance operation;ii. Have at least one year work experience of microfinance operation;iii. Have savings balance: at least 5% of the total loan outstanding in the 1st year, 10% in the 2nd year, 15% in

the 3rd year and 20% in the 4th year and onward; iv. Should have a minimum of 90% loan recovery rate for the first loan, and 98% for the second and subse-

quent loans;v. Should have a committed and dynamic board of directors;vi. Should have active and professional management;vii. Should have appropriate management information system;viii. Should have appropriate business plan;ix. Follows modern accounting system;x. Have appropriate policies and procedures for implementing and monitoring its credit program; xi. Should have at least 50 active borrowers;xii. Should have at least 25 percent female borrowers;xiii. Having a minimum financial resource of Rs. 250,000;xiv. Having a minimum net-worth of Rs. 100,000;xv. Having institutional financial position that shows an increasing trend of operational self-sufficiency over the

last three years; andxvi. Have been properly audited in time.

Box 2: RMDC’s Eligibility Criteria for Lending



and operational costs as well as to earn some profit to attain financial viability and sustainability over a reasonable period of time.

• Regarding a loan term, RMDC gives a period of two years for the first loans, up to three years for the second, and up to five years for the subsequent loans based on the previous repayment records of the MFI and the nature of loan. A grace period of three to six months is given to each loan for repayment.

• Regarding the repayment of loan installments, the MFIs are required to repay the interest dues quarterly and the principal installments quarterly for the first loans and half-yearly for the subsequent loans.

Salient Features of Partner Organizations’ Credit ProgramThe main features of the partner MFIs’ micro-credit programs are as follows:• The partner MFIs of RMDC target the

landless, the assetless or the low-income families living below the national poverty line. To identify the poorer households in a community, the MFIs use a methodology, such as Participatory Rural Appraisal (PRA), Participatory Wealth Ranking (PWR) or household survey.

• Most of the partner MFIs practice the Grameen Bank group lending methodology with a slight modification to suit local conditions. Only a woman member from each poor family is allowed to join an MFI’s micro credit group. Women of the identified households participate in a week-long pre-group training (PGT) organized in a nearby village. During the training, a field staff of the concerned MFI teaches the participating women about MFI’s products and services (loan, savings, insurance, etc.) and their delivery procedures, and about institutional norms and values. At the end of the training, the interested trainee women form themselves into small solidarity groups (five members each), which are then organized into a Center under the facilitation of the trainer field staff.

• No physical collateral is taken against a micro-loan (which maybe upto Rs. 100,000) approved to a client. This facility has encouraged the women of poor households to join a microcredit program. All members of the groups or the whole center are jointly liable for payment of the due amount of a member in case the member fails to repay her loan installment for any reason.

• Some partner MFIs have been offering micro-enterprise loans (up to Rs.300,000) to the graduated clients, who could show an excellent track record of loan repayment in the past, a capacity of utilizing loans and a considerable experience in managing micro-enterprises. Some MFIs are also taking physical collateral against the micro enterprise loans.

• The MFIs charge an annual interest rate of 20 - 25 percent on their loans disbursed

25

• Institution’s legal identity and historical background• Viability of Business plan• Governance and management• Human resource policy and management• Credit policy and operational procedure• Accounting policy and practices• Internal control, auditing and risk management system• Financial management policy and systems• Loan portfolio quantity and quality• Financial status • Capital and financial resources• Management information system• Institutional culture • Feasibility of microfinance operation in the planned area• Market competition

Box 3: RMDC’s Parameters of MFI Appraisal for Lending



A number of success stories collected by RMDC indicate that microfinance has created the following impacts in the clients:• Increased household income and assets of the poor• Improved entrepreneurship and occupational skills of women and the family members• Created self- employment opportunities for the poor• Enhanced confidence level of women borrowers• Developed leadership capability of women borrowers• Boosted dignity of the women borrowers in their families and communities• Improved food security for the poor • Increased school enrollment of children of the clients• Improved sanitation and health conditions of the children and women of the beneficiary households

Box 4: Development Impacts of Microfinance at Client Level

to their clients. The repayment period is generally one year, and the installments are paid weekly, bi-weekly or monthly depending on local situations and clients’ demand and choice. The repayment period of micro-enterprise loans may be 2-3 years depending on the sizes of loan and the nature of enterprise.

• Compulsory member savings is one of the basic savings products offered by the MFIs. Some MFIs have also offered personal voluntary savings, pension fund savings and educational savings schemes to their members. Savers get 6-8 percent of annual interest on their savings deposits.

• In addition to providing microfinance

services, the MFIs conduct training programs for their clients in order to improve the latter’s confidence and occupational skills. The MFIs also make necessary efforts to link their clients with the related government or private development agencies for necessary skills development, market supports, health services, non-formal education, etc.

• Most of the partner MFIs have been able to maintain over 99 percent loan repayment rate. On average they have maintained nearly 98 percent repayment rate.

• Most of the MFIs have attained the operational self-sufficiency and are on way to reach financial self sufficiency.



Promotion and Capacity Building

of Microfinance Institutions

Promotion of New MFIs

RMDC has been identifying the potential institutions among the existing NGOs or cooperatives, orienting them on the basics of microfinance and helping them to start microfinance operations. There is still a greater need to promote MFIs that are committed to expanding microfinance services particularly in the remote hills and mountain areas in the country.

RMDC identifies potential institutions based

(i) Potential institutions (NGOs, cooperatives, banks) are identified based on their institutional profile, experience and commitment towards microfinance;

(ii) An exposure visit program is organized for the executive committee members of the interested potential organization to have a self-study of best practices of microfinance;

(iii) After the visit, the participating members are invited to take part in a three-day interactive orientation program, where participants share their experiences and resource persons facilitate discussions on the major issues, such as essentials of microfinance, steps of implementing microfinance program, factors affecting viability and sustainability of MFIs, and process of determining appropriate interest rate.

(iv) A field staffs of the interested institutions are provided with a two-month long on-site practical training on operational systems at field offices of successful MFIs;

(v) The staffs of the institutions are also trained on PRA/PWR methodologies, which they can use to assess problems and potentialities for implementing microfinance programs in an area, and to identify poorer households;

(vi) A few officials of the institutions are provided with training and on-site guidance on preparing their own three-year business plans;

(vii) The institutions are given on-site consultancy on establishing appropriate operating systems (e.g. accounting, MIS, reporting, monitoring and supervision, internal control, etc.) and on organization of pre-group training and center meeting;

(viii) Regular off-site and on-site monitoring and supervision of the borrowing institutions are undertaken; and(ix) Special on-site technical assistance is also given to an MFI as per its need and demand.

Box 5: RMDC’s Sequential Steps for Promotion of MFIs

27



on their institutional profiles, commitments and visions of their leaders (Board of Directors and chief executives) towards operating sustainable microfinance for reduction of poverty, and the feasibility of microfinance program in their planned geographical areas. RMDC officials also make a number of visits to different districts for identification and development of such institutions. The sequential steps that are followed by RMDC is presented in the box 5.

Capacity Building of MFI Officials, Staff and ClientsRMDC offers a number of capacity building programs particularly to its partner MFIs for upgrading knowledge and skills of their officials and staff on different subjects. During the FY 2011-12, RMDC conducted a total of 42 training programs for MFI officials and staff in which altogether 1,133 MFIs officials and staff participated (see Annex II for the detailed information on the training program). The annual progress trend of the MFIs staff training program of last five years has been shown on Figure 2.

The major MFI staff and officials training programs completed in the country during the reporting fiscal year have been briefly described below.

Training on Financial Analysis and Delinquency Management

RMDC organized a training program onFinancial Analysis and Delinquency Management, in which 22 officials including CEOs, managers & senior officers of partner organizations had participated.The training was held in Kathmandu from 28 February to 1 March, 2012. The purpose of training was to acquaint the participants with tools of financial analysis so that they can understand the financial health of the organization and chalk out future course of actions for improvement. During the training, the trainers focused on the concept, tools and techniques of financial analysis and delinquency management through the case study and group discussions. Senior Manager of RMDC of Mr. Meghraj Gajurel and Manager Pritha Bahadur Thapa were the resource persons for the training.

Figure 2: Annual Progress of MFI Staff Training

2000

1800

1600

1400

1200

1000800

600

400

200

02007-08 2008-09 2009-10 2010-11 2011-12

No. of Staff 674 1021 1845 1728 1133

No.

of S

taff



Training of Trainers (TOT) Program on Micro Business

Rural Microfinance Development Centre (RMDC) Ltd. organized a Training of Trainers (TOT) course for its partner organizations. The training program, which was conducted on March 12-16, 2012, saw 21 participants from 15 partner microfinance institutions of RMDC. Mr. Hermann Rune, Consultant of Savings Banks Foundation for International Cooperation (SBFIC) Germany was the resource person for the training. The objective of the training was to develop skillful trainers who would be able to apply partner oriented and participant activating trainings in their future training programs. The program was coordinated by Ms. Annapurna Shrestha, Manager, Institutional and Social Development Department of RMDC.

Mr. Rune used different methods to impart the training skills to the participants. He used group discussion, free speech, presentations and exercises to hone the training skills of the participants. The participants were enthusiastic and keen to share their knowledge with their colleagues at their organizations.

Training on Micro Business Simulation The Rural Microfinance Development Centre Ltd. organized a Training of Trainers program on micro business simulation from 4 – 6 June, 2012. In the three day long training program, participants were branch managers of the partners MFIs of RMDC and the resource person was Mr. Hermann Rune, Consultant to RMDC from Savings Banks Foundation for International Cooperation (SBFIC) Germany. The objective of the training was to provide economic knowledge with all influencing factors in business development, understand the meaning of entrepreneurial thinking, acting and apply it throughout the simulation, gather knowhow about development of small and medium enterprises and discover challenges and opportunities on the way forward, develop a deeper customer understanding and basic marketing knowledge, realize and understand the market dynamics and competition, know the interface between microfinance institutions and clients and its implications.

Interaction with Partner CooperativesRMDC organized a two-day interaction program with its partner cooperatives in Kathmandu on 13 and 14 June, 2012. A total of 42 officials of 16 MFIs participated in the program. The objective of the interaction program was to explore problems and challenges, experiences and new initiatives of the organizations. Similarly, discussion on the potential contribution of cooperatives in generation of self-employment for the youth and RMDC’s role in such activities was also held.The program was coordinated by Ms. Annapurna Shrestha, chief of Institutional and Social Development Department of RMDC and chaired by Mr. Shankar Man Shrestha, CEO of RMDC. Senior Manager of RMDC, Mr. Ram Dayal Rajbanshi was also present in the program for discussions on various issues. Similarly, manager duo of RMDC, Mr. Pritha Bahadur Thapa and Mr. Roop Bahadur Khadka served as facilitators.The participants praised that the program was very fruitful for the participating organizations as they were able to enhance their knowledge

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of microfinance and learned so many things from the interaction. They also expressed their commitment to apply the learning into practice.

Regional Annual Program Review Workshops of POs

RMDC organized four regional annual review workshops for its partner MFIs, in four different development regions. The main objective of the workshops was to review the progress of partner MFIs of FY 2067-68, give them an opportunity to share good and bad experiences with each other and jointly sketching better strategies and approaches to solve problems and enhance quality of microfinance program and make considarable progress in the coming years.

The Eastern Regional Annual Program Review Workshop was held in Biratnagar during August 5-6, 2011. The workshop was attended by 52 participants from 12 partner MFIs of the Eastern Development Region. The Western Regional Annual Program Review Workshop was organized in Pokhara during October 21-22, 2011, which was participated by 54 participants from 14 MFIs of the Western Development Region. Similarly the joint review workshop for Mid & Far Western Region was held in Nepalgunj, on November 6- 7, 2011. The workshop was witnessed by 65 participants from 20 MFIs. The last workshop was Central Regional Annual Program Review Workshop, which was conducted in Kathmandu during January 26-27, 2012. The workshop was attended by 50 participants from 16 MFIs.

The workshops were attended by top officials of partner MFIs- board of directors including chairpersons and chief executives. During the workshops, each participating MFIs presented its performance status, issues and challenges they have been facing and innovations they have made. Brief interactions on the presentations were held after each presentation.

The workshops were chaired by Mr. Shankar Man Shrestha, Chief Executive Officer of RMDC. Some senior officials of RMDC participated as facilitators in the workshops. The RMDC officials presented the issues and challenges raised by the participating POs while Mr. Shrestha, actively discussed about the solution measures to be used by the partner organizations for each of the outlined problem.

The workshops concluded with way forward to be followed by all participating MFIs. All the participating MFIs vowed to bind by the jointly outlined way forward and contribute towards the safe, sensible and sustainable microfinance operation in Nepal.



Training Program on Internal AuditRMDC organized a four days training program on Internal Audit for its partner organizations. The program was held from February 7-10, 2012, which was attended by 23 participants from 23 partner organizations. The main objectives of the program was to provide the participants theoretical and practical knowledge & skill on internal audit, to enable them to conduct internal audit and prepare internal audit report independently in their organizations. The resource person of the training were Mr. Megh Raj Gajurel, Senior Manager of RMDC and Mr. Roop Bahadur Khadka, Manager of RMDC. The major contents of the training were concept of internal audit, responsibilities & qualities of internal auditor, accountancy vs auditing, internal audit vs external audit, risk management etc. To provide practical exposure, the participants were divided into three groups and taken to three different branches of POs for onsite branch audit exercise. After the branch visit, on the next day the groups made their presentations and had discussions on the problems and issues raised.

Training on Microenterprise Financing

A two days training program on Microenterprise Financing was jointly organized by RMDC and Grameen Trust, Bangladesh in Kathmandu on 13-14 September 2011. The program was attended by 26 participants from partner organizations. The resource person of the training were Mr. S.M. Musa, Deputy General Manager of Grameen Bank Bangladesh and Mr. Mir Hossain Chowdhury, Asst. General Manager of Grameen Trust Bangladesh.

The main objectives of the training program were to familiarize the participants with the concept, methodology and approach of micro enterprise financing, to acquaint them with the process of selection of clients and enterprises, to enlighten them with the loan appraisal and disbursement process and to familiarize them with the process of monitoring, supervision and follow up of micro enterprise loans.

Onsite Technical Assistances to MFIsIn addition to the classroom training, workshops and exposure visits, RMDC provides onsite technical assistance particularly to the start-up MFIs. The main purpose of the technical assistance is to help them establish essential microfinance operational systems and procedures in their offices, and develop required operational knowledge and skills of their staff. The onsite consultancy services are mainly given on: (i) maintaining accounts and

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records, (ii) preparation of program reports and financial statements, (iii) formulation of simple business plan, and (iv) preparation of operational manuals, etc. These programs have been found extremely helpful for the beginner MFIs.

Capacity Building of MFI ClientsRMDC offers financial and technical supports to its partner MFIs to organize need-based training/workshops/exposure visit programs for their clients in order to strengthen groups’ cohesion, improve capacities of the members and upgrade their entrepreneurial as well as occupational skills. During the FY 2011-12, a total of 55,110 MFI clients participated in different training, exposure visits and interaction programs under the financial and technical supports of RMDC (see Annex II for the detailed information on client training programs).

The major MFI clients training programs completed during the fiscal year are mentioned below.

Microfinance Members Conference

A regional level microfinance members conference was organized in Nepalgunj on 4 and 5 November 2011.The conference was for the microfinance members of the mid and far- western development region. The main objective of the program was to facilitate sharing of the experiences and views of the

microfinance members among themselves and with the MFIs executives, orientate the members on basic tenets of microfinance, clarify misunderstanding if any, between MFIs and clients and come up with way forward for effective and sustainable growth and development of the clients and MFIs.

The conference was attended by 132 participants including microfinance members and managers. It was inaugurated by two senior most members of microfinance program of the region and was chaired by Mr. Shankar Man Shrestha, CEO of RMDC.

During the conference the participating members shared their own sufferings before microfinance and changes brought about by microloans, feelings about microfinance program and improvement to be made in the operation. They made active participation in the discussions on the issues and challenges of microfinance sector.

At the end of the program the participants vowed to share the knowledge gained during the conference with their peers, become responsible microfinance members and not to involve in multiple borrowing and over indebtedness. The conference was successful and the women members left the venue enlightened and sensitized on best practice microfinance.

Skill Development TrainingsDuring the fiscal year 2011-12, with the funding supports of RMDC, the partner organizations organized 31 skill development training programs for their clients. All together



942 members benefitted from the training programs. The major types of skill development training organized during the year were on subjects such as mushroom farming, candle making, goat rearing, vegetable cultivation, soap making, incense-stick making etc.

Pre-Group Training (PGT) ProgramsPre-group training is provided to microfinance member before enrolling them into the group. During the training, members are given orientation about microfinance program, information on different loans and savings products and its features, rules and regulations they have to comply as a microfinance client. Members are taught on how to write their name. This helps to increase their self confidence. RMDC is providing support to partner organizations for

conducting pre-group training as well. During the fiscal year a total of 567 pre-group training were conducted in which altogether 12,372 women had attended.

Refresher Trainings

Refresher training is provided to the existing members to review the microfinance rules and regulations and reinforce them to comply. Refresher training has helped to energize members to maintain center discipline as well as financial discipline. Realizing its importance, RMDC from the beginning of its operation has been supporting its partner organizations financially and technically to conduct refresher training for their members. During the fiscal year 2011-12, a total of 1,205 refresher training programs were organized in-house by partner organizations with financial support of RMDC, in which 29,242 clients had participated.

Center Chiefs Workshop

Center chiefs workshops are organized by MFIs generally once in a year in each branch to have interaction among center chiefs and between MFIs and center chiefs. This has been a very effective forum for sharing experiences and learn from each other. These workshops were fruitful to develop leadership quality of center chiefs and make their role effective in managing their centers and dealing with the center related issues and problems. During the fiscal year, 207 workshops of center chiefs were organized by partner organizations with supports from RMDC, altogether 12.422 center chiefs had participated in the workshops.

Figure 3: Annual Progress of MFI Client Training

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Growth and Performance of Partner Organizations

RMDC has been partnering with microfinance development banks (MFDBs), development banks (DBs) implementing microfinance programs, cooperatives (COOPs) and financial-intermediary NGOs (FINGOs). The partner cooperatives include savings and credit cooperatives, multipurpose cooperatives and Small Farmer Cooperative Limited (SFCLs). Till July 15, 2012, it had made partnership with 102 organizations out of which 7 are MFDBs, 9 DBs, 24 FINGOs and 62 cooperatives. Till the date, the POs have been providing microfinance services in 67 districts out of 75 districts of the country. The composition and the growth in number of RMDC’s partners in the last eleven years is depicted in the Figures 4 and 5 respectively.

DBs, 9

COOPs, 62

FI-NGOs, 24

MFDBs, 7

Figure 4: Composition of RMDC’s Partner Organizations.

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Figure 5 : Growth in Number of RMDC’s POs

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As of 15 July 2012, the POs of RMDC had been providing microfinance services to more than 1.3 million members through their 797 branch offices. Among the 1.3 million members 9 hundred thousand were borrowers. The outreach of the POs had been growing in the increasing rate till last FY 2010-11 which was around annual 20% in average, but in FY 2011-12 the growth rate decreased to around 11% which is due to saturation in the terai & plain area and less expansion in hilly area. The outreach expansion

in hills and mountainous districts was low. Due to poor infrastructure, less economic activities, scattered and sparse population, the cost of operation in the hills and mountain was relatively high. Thus MFIs were reluctant to open their branches in these areas.

The average annual growth in number of members and borrowers of the POs in FY 2011-12 was 11 percent and 9 percent respectively. All most all members of the POs are women but SFCLs have higher percentage of male members. On an average, the borrowers-to-members’ ratio stood at 69 percent.



The average outstanding of the POs loan per borrower reached Rs. 18.6 thousand from Rs. 16.5 thousand. There has been gradual increment in the outstanding loan per borrower due to increment in the initial loan size of most of the POs and introduction of bigger size loan

products (such as microenterprise loan, foreign employment loan, housing loan, etc.) for graduated clients. The average outstanding loan per borrower increased by 13% in the FY 2011-12.

Figure 7: Growth of Outstanding Loan of the POs

Figure 8: Trend of Outstanding Loan per Borrower

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Loan PortfolioThe main objective of an MFI is to contribute to reduction of poverty in the country by providing financial access to the poor and help them get out of the poverty trap. To this effect, MFIs have to reach the poor with quality microcredit services to fulfill the wide range of their credit needs. POs have been providing various types of loan products to their members. Most of them have been providing three basic types of loans - general loan, seasonal loan and emergency loan to their members. The members use the loan for a wide range of income generating activities, such as retail grocery, poultry farming, fruit and vegetable trading, fruits and

vegetable farming, cycle repairing, tailoring, shoe making, tea shop, livestock raising, etc. Some of the larger POs also introduced larger loan for micro-enterprise, housing, education, foreign employment.

The graph of the total outstanding loan portfolio of the POs with their borrowers is increasing fast and reached Rs. 17.22 billion as of mid-July 2012, with an annual increment of 22 percent in the fiscal year. Most of the POs have maintained good portfolio quality. On an average, arrear rate of the POs remained less than 2 percent throughout the period. The growth trend of the POs’ loan portfolio is shown in the Figure 7.

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Members’ Savings

Savings is one of the main services provided to the members by MFIs. The entire partner MFIs have been accepting various types of savings from their members. The major types of savings products are compulsory savings such as Group savings and Center Fund savings whereas Personal savings, Child savings, Pension savings, Education savings, Festival savings are voluntary savings. MFIs’ savings service has inculcated the habit of making savings among the members. Savings mobilization is one of the prominent sources

of fund for MFIs and it is a process of assets creation by the members for future needs and enhancing their financial security. As of mid-July 2012, the total member savings deposit with the POs reached Rs. 8.13 billion (see Figure 9), with the increment of around 40% in the FY 2011-12. The savings balance of the POs has been increasing every year which might be due to the expansion of services to members, increment in the members income level and introduction of the various types of member friendly voluntary savings by MFIs such as pension savings, children savings, education savings etc.

Figure 9: Trend of Clients Savings of RMDC’s POs

Figure 10: Trend of Savings Balance per Member

The savings balance per member has also been increasing every year which shows that the savings capacity of the members has been increasing (See Figure 10). As on mid-July 2012,

the savings balance per member of the POs reached Rs. 6 thousand from Rs. 4.8 thousand in the FY 2011-12. There was an increment of 25%, which is very encouraging.

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Operational Self-Sufficiency Most of the POs of RMDC have attained operational self-sufficiency (OSS) in microfinance operation except some new comers.

Most of them have been moving towards attaining the financial self-sufficiency (FSS) level. On an average OSS of the POs stood at 125 percent in the fiscal year 2011-12 which was same as the last year.

Figure 12: Trend of Operational Self Sufficiency (OSS) of POs

Staff Productivity The POs are providing employment to 4,289 persons in microfinance operation among them 2,647 are field staff. The percentage of field staff-to-total staff among the POs stands at 62 percent. The staff productivity of POs was increasing till FY 2009-10, after that it seems somewhat stable with some up and down.

By the end of the fiscal year 2011-12, the staff productivity was on an average 311 members and 216 borrowers per staff (staff includes all staff: from chief executives to field staff and messenger). The outstanding loan per staff was Rs. 4.02 million.

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Figure 11: Trend of Savings-to-Loan Outstanding Ratio in POs

The percentage of members savings balance to outstanding loan is also in the increasing trend (See Figure 11) which reached 47% by the end of the FY 2011-12, it means nearly half of the fund requirement of the POs for on

lending has been fulfilled by the members’ savings. Due to increment in the members’ savings, POs dependency on the borrowed fund also decreased to a large extent.

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Figure 13: Trend of Staff Productivity of POs

Figure 14: Trend of Field Staff Productivity of POs

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Members per field staff

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Staff Productivity No. of members per staff 311 No. of borrowers per staff 216 Outstanding Loan per staff (Rs.) 4.02 millionNo. of members per field staff 503 No. of borrowers per field staff 350 Outstanding Loan per field staff Rs.) 6.51 million

Branch Productivity Ratios No. of members per branch office 1,672 No. of borrowers per branch office 1,161 Outstanding Loan per branch office (Rs.) 21.61 million

Loan Portfolio Quality Current Repayment Rate 98%Cumulative Repayment Rate 99%Arrears Rate 1.4%

Profitability Interest Yeild on Portfolio 20%Operational Self-sufficiency 125%

OthersBorrowers Rate 69%Loan outstanding per borrower (Rs.) 18,611 Savings balance per member (Rs.) 6,099 Savings to Loan Outstanding 47%

Box 6. Performance of RMDC’s Partner Organizations at a Glance

As of July 15, 2012

Members per staff

Borrowers per staff

Regarding field staff productivity, the average number of members and borrowers per field staff was 503 and 350 respectively at the end

of fiscal year 2011-12. The average outstanding loan amount per field staff was Rs. 6.51 million at that point of time.

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Monitoring & Follow-up of Partner MFIs

Importance of MonitoringMonitoring of partner MFIs means the routine collection and analysis of various information of their operations. Generally monitoring can be divided into two parts, off-site and on-site. Off-site monitoring refers to the monitoring of an MFI’s performance without actually visiting the location of the operations, while on-site monitoring requires direct visits to a branch or clients of an MFI. The purpose of monitoring and follow-up is to review whether the actions have taken place in conformity with the stated plan and programs or not. It enables the management to assess the progress of both quantitative and qualitative aspects of the program. Regular monitoring and follow-up provide timely feedback to the management and the concerned for making appropriate decisions. POs (Partner Organisations) of RMDC provide collateral free loans to the poor families. Thus, monitoring and follow-up plays a crucial role to reduce and minimize different operational risks. It also reduces the cost of lending and misuse of loans that leads to delinquency. Effective monitoring system helps MFIs to improve

their performance. It checks areas such as timely implementation of plan, shortfalls and irregularities if any. It helps in minimizing mistakes, building staff capacity, raising staff consciousness and maintaining performance standards, good governance and self regulation. Monitoring and follow-up of POs is considered as a high priority activity of the Centre.

Monitoring Approach of RMDCSupervision Department of the Centre is responsible for carrying out the monitoring of POs activities. It has developed its own simple framework for monitoring its POs. Supervision Department annually prepares monitoring plan for each partner MFIs, which is linked to the areas of high risks identified through the risk assessment process and the deficiencies noted in the previous examination. Moreover, POs are segregated on the basis of their size, existing internal control system, complexity and risk profile. RMDC’s monitoring involves examining different operational activities followed by the indicators logically analyzed on the basis of their status.

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The last stage of monitoring function is follow-up of findings and recommendations made by the supervisors.

Generally, the Centre’s monitoring starts with the visit to the branch office or group of an MFI and concludes with sharing and discussion with field staff and members of management and Board of Directors of the concerned PO. RMDC’s supervisors give priority to visit centre or group meeting and the clients and their enterprises at first. At operational level main areas of monitoring are selection of the group member, quality of pre-group training and group meeting, savings collections, loan proposal and approval procedures, disbursement of loan, loan utilization, impact on client, errors, fraud, bank reconciliation, passbook and collection sheet, interest calculation etc. The supervising officer monitors the activities of field worker and group level activities of clients. At the branch level the supervisor examine accounting transactions and analyse various financial ratios, like portfolio quality and operational & financial self-sufficiency, operational efficiency, profitability, PAR, YOP etc.

During the POs visit the supervisor assesses the governance and strategy of POs, which depends on the quality and appropriateness of the board composition, its role and overall organizational strategy. Management system is rated on the basis of quality of human resources and the strength of accounting and management information. The performance of the POs on staff productivity and ensuring compliance is also assessed. Under financial performance evaluation, financial statements are assessed for checking the aspects like repayment performance, asset quality, liquidity and profitability. He also identifies weaknesses and training needs and makes recommendations.

Risk Based Monitoring and Supervision FrameworkThe risk based monitoring and supervision methodology reflects a continuous and dynamic process. RMDC has adopted risk based monitoring framework and it has own methodology for this purpose. The main objective of the framework is to evaluate the POs risk levels and trends associated with current and planned activities, assessing the management process to identify, measure, monitor and control risks. RMDC’s monitoring procedure assesses the POs financial conditions, compliance

with applicable laws and regulations. In post monitoring phase RMDC communicate findings, directives, and recommendations in a clear and timely manner, and obtain commitments by the Board of directors and management to correct the deficiencies. It is vital to make follow-up on implementation of corrective actions to ensure that all the deficiencies are rectified on time and in a right manner.

During the follow-up the implementation of the recommendations made to the POs thoroughly reviewed and analyzed. The concerned officer at supervision department stay in touch with officials of the concerned partner MFIs and ask them for timely submission of response letter to the Centre. On-going critical issues of partner MFIs are regularly reported to the CEO of the Centre.

Impact of RMDC’s Monitoring, Supervision and Follow-up System

The impact of the RMDC’s monitoring and supervision system is immense and multi-dimensional. It has contributed a lot to maintaining the near hundred percent recovery rate by the partner MFIs. It has contributed in professional assessment of the risk involved in lending to the clients, which is helpful in lowering the appraisal and transaction costs. It has helped to increase the creditworthiness of the MFIs and sensitizes the staff on the best practices of microfinance operations. Monitoring system of the Centre facilitates about how the partner MFIs can balance between its social mission and commercial mission. Due to effective monitoring and follow-up from the Centre institutional governance, office management, portfolio quality, accounting system of the POs have improved considerably. Their own monitoring and internal control mechanism, corporate governance and management quality has been strengthened. The member of the Board of Director, senior managers and field staff and even clients of the POs are now more aware and accountable to their roles and responsibilities. As the industry strives to retain its relevance in the face of big challenges, the unique aspect of RMDC’s monitoring and follow-up system has enlightened the microfinance community on ethics and moral values for enhancing the image and reputation of overall microfinance industry in the country.



Empowering Women ThroughMicrofinance

In Nepal women have been the vulnerable section of society and constitute a sizeable segment of the poverty-striken population. Women still face gender specific barriers to access assets ownership, education, health, employment, participation in social and community activities etc. Women are discriminated in many frontiers. They are kept away from household as well as community decision making process. This has called for intended intervention for women empowerment.

Empowerment can be viewed as a means of creating a social and economic environment in which one can take decisions and make choice either individually or collectively for social transformation. It is the power that comes from self awareness that strengthens innate ability of a person by way of acquiring knowledge and experience.

Empowerment implies acquisition and expansion of assets and capabilities of people

to influence control of resources and hold accountable institution that affects their lives. It is the process of enabling or authorizing an individual to think, behave, take action and control work in an autonomous way. It is the state of feeling of self-empowerment to take control of one’s destiny through own actions. It includes both control over resources (physical, human, intellectual, technological, financial and informational) over ideology and becoming responsible for the family, community, society and the country.

In recent time, microfinance programs are being hailed as powerful tool for empowering women by leading development agencies and renowned scholars. Microfinance considers empowerment as a multi-dimensional social and economic process that helps people gain control over their own lives, social and community activities and in their society, by acting on issues that they define as important.

Women Focused Microcredit Program in NepalIn the developing countries of South Asia, women are most underprivileged and vulnerable. They are prone to domestic and social violence. The case is seen even severe if the women are from the poor family and so called lower caste community.

Targeting at the rural people with an objective to increase the access of finance to lower segment of society the Agriculture Development Bank, Nepal (ADBN), started Small Farmer’s Development Program (SFDP) in 1975, on a pilot basis in two Village Development Committees (VDCs) of the two districts, one in the hill and the other in Terai. The success of the pilot testing prompted the then government to expand it to all

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over the country. The number of Sub-Project Offices (SPOs) reached 422 covering 652 Village Development Committees (VDCs) by December 1996 which were later transformed into Small Farmers Cooperative Limited (SFCLs). SFDP started forming women group for credit extension in number of projects in early 80s, women groups formation became a part of SFDP in later stage. Today there are a number of SFCLs exclusively focusing on women, and led and managed by women.

On the basis of recommendations derived from surveys and studies conducted by the different agencies, microcredit programs focusing on women from rural households of Nepal were first introduced in 1982 as the Production Credit for Rural Women (PCRW) program through the Women Development Section of the Ministry of Local Development of the government. Under PCRW, the government owned Commercial Banks provided loans upto Rs. 30,000 to the group members formed by women development officers of the Ministry of Local Development and the loan was without collateral on just group guarantee. PCRW was a combination of credit, training and community development services. The program continued till December 31, 1997

Meanwhile, the Nepal government and the ADB jointly launched Micro Credit Project for Women (MCPW) as a supplementary program to PCRW from September 1993. The program ended on June 30, 2002 was implemented in selected VDCs and municipalities of 15 districts.

PCRW and MCPW were the projects especially designed for the women. But in the decade of 90s the government initiated five Grameen Bikas Banks (GBBs) and NGO MFIs, such as CSD and Nirdhan launched grameen model microfinance programs focusing exclusively on women from the poor communities. Since then it has become the practice of MFIs in Nepal to run microfinance programs targeted at women. The Grameen model adopted by most of the microfinance institutions (MFIs) in Nepal made it easier for women entrepreneurs to access frinancial services for income generating activities in massive scale.

Microfinance programs today have three components viz. collateral free loan with other financial services, training and community

development services. Loans are borrowed to fill up the capital gap to start income generating activities while trainings are designed to teach them to use the money effectively so that they can raise their income. Similarly, exposure visits, workshops, seminars and conferences are organized to equiped them with knowledge and skills. Besides they are also involved in social and community development services such as health, nutrition, adult literacy. This has helped them to attain financial and social self-reliance.

State of Women before MicrofinanceSpecially, poor women in the rural areas were living in severe condition before the microfinance movement in the country. The rural women used to be busy with the household chorus from early morning to late night. Village women got scared to confront even home visitors as they were not involved in the discussions with other family members. They had to abide by strict traditional discipline.

The situation of women was different in the hills and terai regions as the social structure and economy also different. Traditionally in most rural societies specially, in the terai region women were confined within four walls of their houses. Among the poor, the women were most disadvantaged. They are characterized by lack of education and access to resources, which was required to help them work their way out of poverty and for upward economic, social and psychological mobility. This was due to the low social status and lack of access to



key resources. Generally assets were all owned and possessed by the men, as education and schooling of the girls were very low or not at all in the rural areas.

Women had to solely depend upon their husbands in the financial and social matters. They used to communicate through their husbands only. They did not have any bank accounts and assets in their ownership. The social structure itself was the barrier for the development of the women. So they rarely got chance to participate in any social and community activities. The social system in the rural community did not allow the women to cross the border of households and they were treated as second class citizen in the patriarchal society. They were also prone to social violence in the matters related to dowry. They have also been often victims of sexual abuse, harassment and violence. In the hills and mountains, young women were still trafficked to India and other countries by local miscreants and sometimes by even relatives.

Changes Observed after Microfinance Empowering women puts the spotlight on education and employment which are an essential element for healthy social development. After joining microfinance program, a woman felt empowered in various spheres of her life: such as social, psychological and economic spheres and at various levels, such as individual, group and community, and challenged our assumptions about status quo, asymmetrical power relationship and social dynamics.

The approach and the model of microfinance have been designed in such a way that with the access of finance it has multi-dimensional impact in social and financial spheres of life. The need to attend meetings of the microfinance groups has brought women to the outside world from the confinement of the four wall boundary. On the top, while forming the group and during the center/group meetings, they are encouraged to interact and speak on different issues along with their involvement in the economic activities. They have now been released of tension to have two square meals for their families. In other words food security has been ensured. They are becoming aware of health issues and nutrition values of food. It has created tremendous impact on raising and nurturing their children. They could have better clothes for their children and family.

In due process women are building confidence and stepping ahead in various spheres of life getting involvement in the social and community activities, and becoming capable of making various decisions on their own. These are the silhouettes of changes observed after microfinance.

Credit for empowerment is about organizing people, particularly around credit and building capacities to manage money. The focus is on getting the poor to mobilize their own funds, building their capacities and empowering them to leverage external credit. Their learning to manage money and rotate funds builds their capacities and confidence to participate in local institutions beyond the limited goals of ensuring access to credit.

Microfinance programs in Nepal are predominantly women focused and emphatic on economic empowerment assuming that economic empowerment resulting in women’s ability to influence or make decisions, increased self confidence and better status and role in households and community. In some instances, microfinance seems to be necessary to overcome exploitation and create confidence for economic self reliance of the rural poor, particularly rural women who are mostly invisible in the social structure.

Micro loans are made available solely to the women from the poor and deprived communities and have been able to create impact on them.

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• It is experienced that women are better customers and the better managers of resources than men. If loans are routed through women, benefits of loans are spread wider among the family members.

• The microfinance members have learnt to write their names during the process of pre group training. This has inspired the members to send their children to school. Over 90% of the members are sending their children to school.

• Women clients have also experienced improved status and balanced gender relations in their homes. Women’s financial contributions helped them earn greater respect from their husbands and children, negotiate husbands’ participation in household chores and avoid family quarrels over money.

• Several studies show that women received more respect from their communities than they did before, after joining a micro finance program. Those studies have also found increased respect for women from other family members and better relationship within extended family and in-laws. Microfinance member women are taking greater roles in the community meetings and actively involving in the social and development programs

• Studies have revealed that women microfinance members are also participating in the local political institutions.

• Women clients found socially and financially more disciplined and have maintained outstanding loan repayment performance. As a result, MFIs have near

to 99% repayment rate. • Reduction of violence to women has also

been observed in the rural communities after microfinance operations. They are now more organized and the male counterparts cannot dare to humiliate them. The women are economically active. They do earn money from their business activities. They do not have to look to the husbands to meet their small needs.

• Many women borrowers have been able to procure assets such as land and houses by their own income and get registered in their names. This has raised their status and image in the society.

• Each of the members is a saver. This has cultivated saving habit among the members and raised their saving day by day. This has also helped MFIs to raise financial resources for their lending through their own members. It forms nearly half of the total outstanding loan of MFIs in Nepal. They are silent savers and now capable on their own to manage crisis situations too.



Role of RMDC in Women EmpowermentRMDC as a wholesale lending organization established with a view to expand financial services to the poor and deprived families for generating self- employment by involving them in economic activities. It has been constantly involved in assisting financial intermediary NGOs, Cooperatives and Microfinance Development Banks to increase outreach to poor households specially women. Women empowerment has been the thrust of the microfinance programs. RMDC has always shown deep concern in developing awareness among women, imparting training to build up business skills of women members that they can come out from poverty.

It has been training women in various ways to make them socially, psychologically and financially active through its MFIs. With the support of RMDC 5,80,230 women clients had have been trained till July 15, 2012. Over 95% of the member of RMDC’s partner MFIs are women. There are 1.3 million savers today with RMDC’s partners and their saving balance stood at Rs. 8 billion as of July 15, 2012. RMDC has been supporting its partner MFIs in organizing pregroup training, leadership training, center chief workshops and also had organized four regional conferences of MFIs women clients which have been instrumental to unleash their hidden potentials and sharing experiences, knowledge and information.

It is an important achievement towards women empowerment. As of mid July 2012, nationwide 1.3 million microfinance clients are utilizing over Rs. 17 billion loan from 102 partner MFIs of RMDC. It is really a land mark change that Rs. 17 billion worth assets are managed by women who were once treated as second-class human beings in the society.

Similarly, RMDC has been encouraging its partner MIFs to emphasize women candidates while recruiting employees. RMDC has been highlighting the works of successful women entrepreneurs in its newsletter as well.



Mic

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RMDC has been cooperating and collaborating with various international organizations and institutes in organizing training, seminars, conferences and exposure visits. Two years ago it organized SAARC Regional Conference on Microfinance jointly with Institute of Microfinance, Bangladesh. It also has had programs with Grameen Trust Bangladesh, Microcredit Summit Campaign, Banking with the Poor Network and others. In the FY 2011-12, following programs had been organized / sponsored by RMDC for foreign delegates and RMDC officials.

Bank of Ceylon, Srilanka Team’s Visit to Nepal

RMDC organized an exposure visit program for the officials of the Bank of Ceylon (BOC), Srilanka from 21 to 27 August 2011. The team led by Chief Manager of the bank Mr. W.A.C.

Tissera comprised of the managers of the bank, Mr. M.J. Prabaharahan, Mr. B.M. Gunasekara, Mr. T. Puwanedran, Mr. R.G. Gunapala and Mr.D.L.A Madugalla. The purpose of the visit was to understand the ongoing practices of microfinance in Nepal.

During the visit, the team discussed about various aspects of Nepalese microfinance sector with RMDC officials and made field visit to Western Nepal to observe the activities of MFIs. They visited branch offices as well as head offices of RMDC’s partner MFIs namely Shreejana Vikas Kendra, Pokhara; Nirdhan Utthan Bank, Bhairahawa and Nawa Prativa Savings and Credit Cooperative Ltd., Arunkhola, Nawalparasi. Similarly, they also observed the center meetings of these MFIs. While visiting the MFIs they interacted with the branch staffs and senior officers to understand the MF operational modality and practice.

International Cooperation

49



The study visit concluded with a presentation about the visit program by the team they shared their observations and experiences of the visit. All the team members loudly appreciated the role of RMDC’s in the development of Nepalese MF sector.

Tanzanian Officials’ Visit to Nepal

A team from Tanzania, a country located in East Africa, completed its exposure visit to RMDC from November 22 to December 1, 2011. The visiting team representing the Ministry of Finance run Small Entrepreneurs Loan Facility (SELF) project was led by Ms. Elizabeth Jocktan Nyambibo, Chairperson of SELF project. The other members of the team were Ms. Flora Lugangira Rutabanzibwa, Member of SELF project representing the central bank of Tanzania; Mr. Ameir Haji Sheha, Member of the project representing Ministry of Economic Empowerment; Mr. Lungu Nyamwelu Phares and Mr. Gerini Sigsbert Shayo, project staffs. Exposure visit program was coordinated by Managers duo Ms. Annapurna Shrestha and Mr. Roop Bahadur Khadka of RMDC.

The objectives of the exposure visits were to know about the history and growth of microfinance in Nepal and the methodology followed by MFIs at the ground level and to understand RMDC’s role and responsibilities.

The team visited branches and head offices of RMDC’s partner MFIs located in Western Nepal, namely Muktinath Development Bank Ltd, Pokhara; Shreejana Vikas Kendra,

Pokhara; Chhimek Microfinance Development Bank Ltd. branch office Bharatpur and Nawa Prativa Savings and Credit Cooperative Ltd., Arunkhola, Nawalparasi Similarly, they also observed the center meetings of those MFIs. While visiting the MFIs, they interacted with the branch staffs and top officials of the concerned organization to understand their operational modality and practice. Similarly, they interacted with the borrowers of the MFIs as well.

The team members expressed that it was really a good experience for them and they learned about the practice of microfinance operation in Nepal. They felt that they should revise their microfinance program strategy to ensure that the poorest would be benefitted from microfinance.

All the members appreciated Nepalese Microfinance practices and RMDC’s role in the development of the Nepalese Microfinance Sector. Exposure visit concluded with the presentation on their findings and lesson learnt.



ASKS, Bangladesh Advisor’s Visit to RMDC & its Partner MFI

An international visitor Ms. Hina Musa from Bangladesh visited RMDC from March 8-9, 2012. She holds the post of International Strategic Relationship Advisor in Anannyo Saving Kalyan Sanstha (ASKS), a microfinance organization in Bangladesh. During her visit she met with the CEO of RMDC Mr. Shankar Man Shrestha and discussed with him on different aspects of microfinance and possibilities of mutual cooperation between two institutions.

During the visit Ms. Hina Musa observed one of the Centre meeting of Women Support Cooperative (WSC) Balaju along with Mr. Roop Bahadur Khadka, Manager of RMDC and Ms. Sweta Shrestha, Senior Assistance of RMDC.

After their regular meeting activities, the members were asked about operational modality. The groups have mainly been

using their money mainly in vegetable farming and buffalo and goats rearing. Some of them also owned small grocery shops while some of them had tea shops. One of the borrower had grill shop run by her husband.

According to them, their lives had been changed after joining the group and

accessing loan for micro enterprise. They no more required to rely on the local money lender for small money. After joining the group, the borrowers even learnt to sign their names. After the observation, Ms. Hina remarked that the centre meeting was very interesting and fruitful.

Bhutan Officials’ Visit to RMDC and its Partners

RMDC organized two exposure visit programs for the delegates of Respect Educate Nurture and Empower Women (RENEW), Bhutan from April 14-19, and from May 17-21, 2012. RENEW is the first NGO of Kingdom of Bhutan and is aiming to launch microfinance program in Bhutan. In the two exposure visit programs nine staff from the RENEW had participated.

The objective of the visit was to get acquainted with the microfinance operation, process & practices in Nepal. The delegation visited branch and head offices of some of the RMDC partner MFIs. During the visit, they observed the process of microfinance operation such as center meetings, pre-group training and group recognition test etc. They interacted with field officers, branch managers, center chiefs and clients about the microfinance program. They also learned about accounting system, process of book- keeping, preparation of financial statement, management information system, ratio analysis and other calculation used in microfinance operation. The team expressed that the visit was proved to be a good learning experience for the both individuals and institution.

51



Participation in 2011 Global Microcredit SummitMr. Shankar Man Shrestha, CEO of RMDC participated in the ‘2011 Global Microcredit Summit’ held on November 14-17, 2011 in Valladolid, Spain. The summit was organized by Microcredit Summit Campaign.

More than two thousand delegates hailing from more than a hundred countries participated in the great gathering. The summit brought together various dignitaries, experts, practitioners, researchers from around the world. It gave opportunity for the reflections, debates on the struggle against the poverty. The contribution was great and drawn way forward for the future. There were over 17 participants from Nepal and among them were Dr. Harihar Dev Pant, Mr. Dharma Raj Pandey, Mr. Ram Chandra Joshi, Ms. Padmasana Shakya, Dr. Sumitra Manandhar Gurung. Mr. Shrestha and Dr. Pant were among the speakers.

Participation in South Asia Regional Workshop on Microfinance Credit Reporting

Mr. Shrestha, CEO and Senior Manager Mr. Tirtha Ratna Konajo, attended the ‘South Asia Regional Workshop on Microfinance Credit Reporting’ held on 14 December 2011 in Delhi, India. The workshop was organized by International Finance Corporation (IFC).

The objective of workshop was to bring sector experts together and aimed to address queries around the functioning and use of Credit Bureaus in the region. However, with a fast-growing sector, in the microfinance industry multiple borrowings by clients had become an issue. The workshop was organized to sensitize the importance of Credit Information Bureau and information sharing in the microfinance sector to address the multiple borrowings issue for the inclusive financing.



RMDC Delegation to Germany

At the Invitation of the Savings Banks Foundation for International Cooperation (SBFIC), Germany, a delegation of the Rural Microfinance Development Centre Ltd. (RMDC) had visited Germany from June 16 – 24, 2012. The delegation led by Chief Executive Officer Mr. Shankar Man Shrestha comprised of two Senior Managers Mr. Megh Raj Gajurel and Mr. Ram Dayal Rajbanshi, and three Managers Mr. Pritha Bahadur Thapa, Ms. Annapurna Shrestha, and Mr. Roop Bahadur Khadka.The delegation visited the East German Savings Banks’ Academy (OSV), Postdam & the German Savings Bank (DSGV), Berlin. During the visit, the officials of East German Savings Banks Academy made presentations on various facets of human resource development and the process of education & training to the Savings Bank. The officials of the East German Savings Bank Association highlighted the history, process of operation, monitoring and supervision of the Savings Banks and role of the Savings Bank Association in promotion and development of financial literacy to the general people.Likewise in the Head office of the Savings Banks Foundation for International Cooperation (SBFIC), Bonn, the RMDC officials were given a presentation on the SBFIC activities in different countries. SBFIC was established in January 8, 1992 as a non-profit organization. Since then, it has undertaken more than 150 projects in

over 60 countries and is currently operating 30 projects in 24 countries.At the end of the visit, the delegation visited Kempten where it was briefed on the activities of the Savings Bank, Allgaeu & the process of banking supervision in Germany. The delegation also visited the branches of the Savings Banks, Allgaeu, Kempten and had an interaction with the CEO & other board officials. It also visited a Cashless Branch of the Savings Banks, Allgaeu. At the cashless branch, all transactions of depositing and withdrawing money from the customers’ account are conducted through ATM machines. The delegates enquired about the products and services, loan approval system, service delivery mechanism and the roles and responsibility of the staff. They also interacted with a client & visited his diary project.The main event of the visit was the signing of the project agreement. On June 21, 2012, a formal ceremony was held at the office of the Savings Bank, Allgaeu, Kempten where the Chief Executive Officer of RMDC, Nepal Mr. Shankar Man Shrestha, the Chief Executive Officer of SBFIC, Bonn Mr. Niclaus Bergmann & the Chief Executive Officer of the Savings Banks, Allgaeu Mr. Manfred Hegedues signed the project agreement for launching a capacity building project for microfinance in Nepal. The project aims at developing the staff capacity and RMDC partner MFIs to assist the ultimate clients to upgrade their business skills and enterprise management knowledge.

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Participation in TOT in Bangladesh

Two officials of RMDC senior officer Ms. Gyanu Bhandari and officer Mr. Jaya Ram Khadka participated in the international training program “Design and Development of Training Materials”. The training program was jointly organized by Asian Institute of Technology (AIT) Thailand and Institute of Microfinance (InM), Bangladesh. The training was conducted at InM International Training Centre, Cox’s Bazar, Bangladesh for 5 days from 17-21 June 2012.

The training was focused on imparting practical skill to identify and develop training materials to enhance the quality and effectiveness of training. The training was facilitated by a team of three AIT professional resource persons.

Microcredit Summit Campaign Report Release

RMDC, as a representative of Microcredit Summit Campaign for Nepal has been releasing report of the Microcredit Summit Campaign each year. The Microcredit Summit Campaign is a project of RESULTS Educational Fund, a U.S. - based advocacy organization committed to creating the will to eliminate poverty. The Campaign brings together

microfinance practitioners, advocates, researchers, investors, donors and stakeholders to promote best practices in the field, to stimulate the interchange of knowledge, and to work towards reaching the Campaign’s goals.

RMDC released the Microcredit Summit Campaign Report 2012 on November 10, 2012 in presence of media people from the newspapers, magazines, and televisions. During the press meet Mr. Shankar Man Shrestha, CEO of RMDC, highlighted the main findings of the report such as outreach of the microfinance, its growth rate, issues and challenges faced by global microfinance industry, its quality and contribution in reducing the poverty across the world.



Institutions that Received

Training Supports from RMDC

S.N. Name of Organizations

Microfinance Development Banks1 Chhimek Laghubitta Bikas Bank Ltd., Hetauda2 Deprosc Laghubitta Bikas Bank Ltd., Bharatpur3 Madhyamanchal Grameen Bikas Bank Ltd., Janakpur4 Madhyapaschimanchal Grameen Bikas Bank Ltd., Nepalganj5 Nerude Laghubitta Bikas Bank Ltd., Biratnagar6 Nirdhan Utthan Bank Ltd., Bhairahwa7 Paschimanchal Grameen Bikas Bank Ltd., Butwal8 Purbanchal Grameen Bikas Bank Ltd., Biratnagar9 Sana Kisan Bikas Bank Ltd., Kathmandu10 Sudurpaschimanchal Grameen Bikas Bank Ltd., Dhangadhi11 Summit Laghubitta Bikas Bank Ltd. Jhapa12 Swablamban Bikas Bank Ltd., Janakpur

Development Banks13 Gaurishankar Bikas Bank Ltd., Kawasoti14 Triveni Bikas Bank Ltd., Narayanghat15 Bageswori Bikas Bank Ltd., Nepalganj16 Siddhartha Bikas Bank Ltd., Butwal17 Muktinath Bikas Bank Ltd., Pokhara

Cooperatives18 Aguali Samajik Uddhyami Mahila Cooperative Ltd., Aguali, Danda19 Ananda Saving & Credit Cooperative Ltd., Kathmandu20 Andhakar Mukti Saving and Credit Cooperative Ltd., Palpa21 Arunodaya Saving & Credit Cooperative Ltd., Parsa22 Atma Nirbhar Tarkari Uttapadan Cooperative Ltd., Kavre23 Baghkhor Samajik Uddhyami Mahila Cooperative Ltd., Chitwan24 Batabaran Sudhar Multi-purpose Cooperative Ltd., Surkhet25 Bhimkul Saving & Credit Cooperative Ltd., Gorkha 26 Bikas Bahuuddyesha SCO Ltd., Shankarnagar, Rupandehi

As of July 15, 2012

Annex I

55



S.N. Name of Organizations27 Bindhbasini Saving & Credit Cooperative Ltd., Kavre28 Bishawajoyti Mahila Bikas Multipurpose Cooperative Ltd., Kailali 29 Bishazari Samajik Uddhyami Mahila Cooperative Ltd., Gitanagar, Chitwan30 Biswasilio Saving & Credit Cooperative Ltd., Bardiya31 Bouddha Grameen Saving and Credit Cooperative Ltd., Latikoilee, Surkhet32 Bramahapuri Saving & Credit Cooperative Ltd., Lalitpur 33 Chameli Saving and Credit Cooperative Ltd., Sarlahi34 Chaturbhujeshwor Multipurpose Ship Mahila Cooperative Ltd., Sarlahi35 Dana Grameen Saving & Credit Cooperative Ltd., Jhumka, Sunsari36 Deurali Multipurpose Cooperative Ltd., Panchthar37 Deurali Saving and Credit Cooperative Ltd., Lamjung38 Dhnanjaya Multipurpose Cooperative Ltd., Surkhet 39 Digo Kosh Sanchalan Saving and Credit Cooperative Ltd., Rolpa40 Digree Sai Kumari Saving & Credit Cooperative Ltd., Rukum41 District Federation Office of SFCLs Ltd., Dhading42 Dolkha Multipurpose Cooperative Ltd., Dolkha43 Ekta Saving & Credit Cooperative Ltd., Kumaripati, Lalitpur44 Everest Cooperative Ltd., Pokhara45 Everest Saving & Credit Cooperative Ltd., Banke46 Gangamala Cooperative Ltd., Surkhet47 Gorkha Cottage & Small Industries Cooperative Ltd., Jhapa48 Gorkhkali Saving & Credit Cooperative Ltd., Gorkha49 Gosaikunda Multipurpose Cooperative Ltd., Nuwakot50 Grameen Bikas Multipurpose Cooperative Ltd., Dailekh51 Grameen Jagaran Saving & Credit Cooperative Ltd., Surkhet52 Hadhdeva Agriculture Cooperative Ltd., Taplejung 53 Hamro Bank Saving & Credit Cooperative Ltd., Kavre54 Hamro Thailee Saving & Credit Cooperative Ltd., Lalitpur 55 Hari Tara Saving & Credit Cooperative Ltd., Arghakhanchi56 Hatemalo Mahila Multipurpose Cooperative Ltd., Kathmandu57 Hatemalo Saving & Credit Cooperative Ltd., Accham58 Helping Saving & Credit Cooperative Ltd., Lalitpur 59 Himchuli Krishi Cooperative Ltd., Kalikot60 Ideal Cooperative Ltd., Rajbiraj61 Indragram Punarmilan Saving & Credit Cooperative Ltd., Chitwan62 Indrapur Multipurpose Cooperative Ltd., Morang63 Jagaran Saving & Credit Cooperative Ltd., Kathmandu 64 Jagriti Saving & Credit Cooperative Ltd., Achham65 Jana Jagriti Tarkari Utpadan Cooperative Ltd., Dhulikhel66 Janahitkari Saving & Credit Cooperative Ltd., Surkhet67 Janahitkosh Saving & Credit Cooperative Ltd., Ramechhap68 Janajagaran Saving & Credit Cooperative Ltd., Dolkha69 Janakalika Saving & Credit Cooperative Ltd., Baitadi 70 Janakalyan Saving & Credit Cooperative Ltd., Dolkha71 Janakalyan Saving & Credit Cooperative Ltd., Makwanpur



S.N. Name of Organizations72 Janakalyan Saving & Credit Cooperative Ltd., Malekhu, Dhading73 Janakalyan Saving & Credit Cooperative Ltd., Sunsari74 Janakalyankari Saving & Credit Cooperative Ltd., Baitadi75 Janamukhi Saving & Credit Cooperative Ltd.,Dolkha76 Janasachetan Saving & Credit Cooperative Ltd., Dolakha77 Janasewa Saving & Credit Cooperative Ltd., Kanchanpur 78 Janasewa Saving & Credit Cooperative Ltd., Khotang79 Jankalayan Multipurpose Cooperative Ltd., Bara80 Janupkar Saving & Credit Cooperative Ltd., Dolakha81 Jaya Durge Multipurpose Cooperative Ltd., Doti 82 Jeevanpayogi Saving & Credit Cooperative Ltd., Doti83 Jilla (District) Saving & Credit Cooperative Ltd., Achham84 Jyoti Mahila Development Cooperative Ltd., Chitwan85 Kailash Saving & Credit Cooperative Ltd., Achham86 Kalidevi Multipurpose Cooperative Ltd., Lalitpur87 Kalika Multipurpose Cooperative Ltd., Rasuwa88 Kalyankari Saving & Credit Cooperative Ltd., Lalitpur 89 Kamalamai Multipurpose Cooperative Ltd., Sindhuli90 Kanchanjanga Agriculture Cooperative Ltd., Taplejung91 Kanchanjanga Samudayik Multipurpose Cooperative Ltd., Taplejung92 Kanchanjunga Saving & Credit Cooperative Ltd., Fidim, Panchthar93 Karai Khola Agri.Cooperative Ltd., Surkeht 94 Karnali Saving & Investment Cooperative Ltd., Jhapa95 Karpureshwor Saving & Credit Cooperative Ltd., Lamjung 96 Kasturi Multipurpose Cooperative Ltd., Jajarkot97 Kawasoti Samajik Uddhyami Mahila Cooperative Ltd., Kawasoti, Nawalparasi98 Kedarnath Saving & Credit Cooperative Ltd., Darchula99 Khairenitar Mahila Bikas Multipurpose Cooperative Ltd., Tanahu100 Kisan Kalpan Saving & Credit cooperative Ltd., Sunsari101 Kisan Multipurpose Cooperative Ltd., Kailali102 Kola Samaijee Mahila Bikas Multipurpose Cooperative Ltd.,Dadeldhura103 Kolmateshowr Saving & Credit Cooperative Ltd., Thali, Kathmandu104 Koseli Saving & Credit Cooperative Ltd., Bardiya 105 Krishak Jagaran Upvokta Cooperative Ltd., Lamjung106 Lagani Multipurpose Cooperative Ltd., Lalitpur 107 Lagansheel Samajik Uddhyami Mahila Cooperative Ltd., Shaktikhor, Chitwan108 Laliguras Multipurpose Cooperative Ltd., Tanahu109 Madiganga Mahila Multipurpose Cooperative Ltd., Tanahu110 Mahila Jagaran Cooperative Ltd., Salyan111 Mahila Jagaran Saving & Credit Cooperative Ltd., Makwanpur112 Mahila Kalyan Saving & Credit Cooperative Ltd., Bajhang113 Mahila Kalyan Saving & Credit Cooperative Ltd., Makwanpur114 Mahila Prayas Saving & Credit Cooperative Ltd., Kathmandu115 Maitri Multipurpose Cooperative Ltd., Gulmi116 Maitri Saving & Credit Cooperative Ltd., Baluwatar, Kathmandu

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S.N. Name of Organizations117 Manmaiju Samaj Kalyan Multipurpose Cooperative Ltd., Kathmandu118 Marsyangdi Community Development Multipurpose Cooperative Ltd., Tanahu 119 Mhepi Saving & Credit Cooperative Ltd., Kathmandu120 Namuna Mahila Agriculture Cooperative Ltd., Taplejung121 Narayan Multipurpose Cooperative Ltd., Dailekh122 Navachetan Saving & Credit Cooperative Ltd.,Parbat123 Navapragati Saving & Credit Cooperative Ltd., Pragatinagar124 Navapratibha Saving & Credit Cooperative Ltd., Nawalparasi125 Navodaya Multipurpose Cooperative Ltd. Topgachhi, Jhapa 126 Nawadeep Multipurpose Cooperative Ltd., Kathmandu127 Nawajagaran Saving & Credit Cooperative Ltd., Dadeldhura 128 Nawasiddhartha Saving & Credit Cooperative Ltd., Pyuthan129 Nhakanda Saving & Credit Cooperative Ltd., Lalitpur 130 Nobel Samudayik Agriculture Cooperative Ltd.,Taplejung 131 Palpa Rara Saving and Credit Cooperative Ltd.,Palpa132 Palung Multipurpose Saving & Credit Cooperative Ltd., Makwanpur133 Pathibhara Agriculture Cooperative Ltd., Taplejung 134 Pokhara Royal Cooperative Ltd., Mahendrapul, Pokahara135 Pragati Saving & Credit Cooperative Ltd., Salyan136 Radha Krishna Saving and Credit Cooperative Ltd., Kailai137 Ranitar Multipurpose Cooperative Ltd., Kavre138 Royal Cooperative Ltd., Syangja139 Rural Multipurpose Cooperative Ltd., Morang140 Sahara Women Saving & Credit Cooperative Ltd., Dhading141 Sahara-Nepal Saving & Credit Cooperative Ltd., Charali, Jhapa142 Samudayik Saving & Credit Cooperative Ltd., Rukum143 Samudayik Sewa Cooperative Ltd., Kathmandu144 Samuhik Multipurpose Cooperative Ltd., Sindhupalchowk145 Sana Kisan Agriculture Cooperative Ltd., Khadbabangai, Rupandehi146 Sana Kisan Cooperative Ltd., Surkhet147 Sarasawotisthan Multipurpose Cooperative Ltd., Doti148 Sarwagin Samajik Uddhyami Mahila Cooperative Ltd., Chitwan149 Saving & Credit Association, Siraha150 Sayaptri Saving & Credit Cooperative Ltd., Dharan151 Seshmati Multipurpose Cooperative Ltd, Kathmandu152 Seti Devi Multipurpose Cooperative Ltd., Ilam153 Seti Devi Multipurpose Cooperative Ltd., Kavre154 Sewa Saving & Credit Cooperative Ltd., Sunsari155 Shantikunj Samajik Uddyami Mahila Cooperative Ltd., Ratnanagar, Chitwan156 Shramajibi Saving & Credit Cooperative Ltd., Siraha157 Shree Nayapati Saving & Credit Cooperative Ltd., Kathmandu158 Shuvalabh Saving and Credit Cooperative Ltd., Taplejung159 Siddhartha Saving & Credit Cooperative Ltd., Kapilvastu160 Sikhar Samaijee Saving & Credit Cooperative Ltd., Dadeldhura161 Silsila Bahudeshiya Saving & Credit Cooperative Ltd., Arghakanchhi



S.N. Name of Organizations162 Small Farmers Cooperative Ltd (SFCL) Chtatredeurali, Dhading163 Small Farmers Cooperative Ltd (SFCL) Sriantu, Ilam164 Small Farmers Cooperative Ltd (SFCL) Uttarganga, Surkhet165 Small Farmers Cooperative Ltd. (SFCL) Dumarbana, Bara166 Small Farmers Cooperative Ltd. (SFCL) Nawalparasi167 Small Farmers Cooperative Ltd. (SFCL) Parroha, Rupandehi168 Small Farmers Cooperative Ltd. (SFCL) Semlar, Rupandehi169 Sudur Paschim Saving & Credit Cooperative Ltd., Dadeldhura170 Suryadaya Saving & Credit Cooperative Ltd., Parsa171 Tamor Mahila Agriculture Cooperative Ltd., Taplejung172 Tapkhola Jalbidhut Cooperative Ltd., Khotang 173 Taplejung Multipurpose Cooperative Ltd.,Taplejung174 Udayadev Multipurpose Cooperative Ltd., Kanchanpur175 Uma Devi Multipurpose Cooperative Ltd., Kavre176 United Saving & Credit Cooperative Ltd., Lalitpur177 Upahar Samajik Uddhyami Mahila Cooperative Ltd., Bijaynagar, Chitwan178 Upkar Saving & Credit Cooperative Ltd., Waling, Syangja179 VYCCU Saving & Credit Cooperative Ltd., Gaindakot, Chitwan180 Women Cooperative Ltd., Kathmandu181 Women Support Cooperative Ltd., Kathmandu

Non-Government Organizations (NGOs)182 Adarsha Youth Club, Bhaktapur183 Ama Samaj Sangh, Chitwan184 Association for Rural Women Development, Dang185 Bhagawan Youth Club, Kathmandu186 Centre for Self-help Development (CSD), Kathmandu187 Centre for Women Rights & Development, Kathmandu188 Chartare Yuwa Club (CYC), Baglung189 Chetana, Sarlahi190 Community Women Development Center (CWDEC), Saptari191 Creative Institute Nepal, Butwal192 CWEDA, Kathmandu193 CWIN, Kathmandu194 Dhanusha Sewa Samiti, Janakpurdham195 Dhaulagiri Community Resources Development Center (DCRDC), Baglung196 Economic Development Council, Minbhawan, Kathmandu197 ENSAVE, Jhapa198 Forum for Rural Women Ardency Development (FORWARD), Sunsari199 Grameen Mahila Utthan Kendra, Dang200 Institute for Community Dedelopment (ICD), Kathmandu201 Institute for Integrated Development Studies (IIDS), Kathmandu202 Jagriti Yuwa Club, Kaski203 Jan Utthan Pratisthan, Kathmandu204 Jeevan Bikas Samaj, Morang

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S.N. Name of Organizations205 JMC/Nepal, Bharatpur206 Khurkot Yuwa Club, Parbat207 Mahila Adarsha Sewa Kendra, Kathmandu208 Mahila Saghan Bikas Kendra, Chitwan209 Mahila Swablamban Samaj, Bharatpur210 Mahila Upkar Manch, Kohalpur, Banke211 Mahuli Community Development Center, Saptari212 Manasalu Devt. Centre, Gorkha213 Manushi, Kathmandu214 Matyr Saroj M. Club, Simara215 Nari Utthan Kendra, Bharatpur216 Nari Utthan Tatha Balbalika Samrachhan Sangh, Saptari217 NDRC, Pokhara 218 Neighbourhood Society Services Center (NSSC), Kathmandu 219 Nepal Mahila Samudayik Sewa Kendra, Dang220 Nepal Mahila Utthan Kendra, Kathamndu221 Nepal Rural Development Organization (NERUDO), Kathmandu222 Nepal Rural Development Society Center (NRDSC), Biratnagar223 Nepal Sikara Grameen Bikas Sanstha, Chitwan224 NESDO, Parbat225 Patan Business & Professional Women, Patan226 Project Approach Team for Rural Organization (PATRON), Dhankuta227 RADAR, Parbat228 Rural Awareness Forum (RAF), Baglung229 Rural Reconstruction Nepal (RRN), Kathmandu230 Sajhedari Nepal, Kathmandu231 Samaj Kalyan Samiti, Surkhet232 Sarbodaya Development Organization, Saptari233 SERSOC, Besisahar, Lamjung234 Social Welfare Action Nepal (SWAN), Dang235 Society for Local Volunteers Effort (SOLVE), Dhankuta236 Srijana Bikas Kendra, Pokhara237 Srijana Samudayik Bikas Kendra, Siraha238 Super, Tulsipur, Dang239 Tarun Club (STC), Nepal, Dang240 Tharu & Razi Women Society, Kailali241 United Youth Club, Bardia242 Women Awareness Center, Kavre243 Women Entrepreneurs Association of Nepal (WEAN), Lalitpur244 Women’s Self-Reliant Society, Chitwan



Annual Training Progress of

RMDCAs of July 15, 2012

Annex II

A. National Level Officials and Staff Training Programs

S.N. Name of the Programs Target Group No. of Programs

No. of Participants

1 Regional Annual Review Workshop (Eastern, Western, Mid & Far Western & Mid Region)

BoDs, CEOs, Managers & Sr. Officers

4 221

2 On-site Training Program Managers 1 3

3 Exposure Visit Program of the Officials of the Bank of Ceylon, Sri Lanka

Managers of Bank of Ceylon, Sri Lanka

1 6

4 Training on Micro Enterprise Financing Managers & Sr. Officers 1 26

5 Exposure Visit Program of the Officials of the SELF Project, Tanzania

Board members & Project staff

1 5

6 Training on Internal Audit Managers & Sr. Officers 1 23

7 Training on Financial Analysis & Delinquency Management

CEOs, Managers & Sr. Officers

1 22

8 Visit of ASKS, Bangladesh Ms. Hina Musa 1 1

9 Training of Trainers (TOT) Managers & Sr. Officers 1 21

10 Exposure Visit Program of the Officials of RENEW, Bhutan

Project Staff 2 9

11 Training on Micro Business Simulation Branch Managers 1 15

12 Interaction Program with RMDC's Partner Cooperatives

Chairman, BoD and Managers

1 42

13 Exchange Visit Program Board members 1 6

Total 17 400

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B. National Level MFI Client Program


No. of Participants

1 Mid & Far Western Region MF Members Conference

Members & Managers 1 132

Total 1 132

C. MFIs’ In-house Staff Training Programs


No. of Participants

1 Account and Management Training Board members & Managers 1 26

2 Branch Management Training Branch Managers 1 20

3 On-site Practical Training Board members & Staff 1 80

4 Member's Orientation and Institutional Assessment

Staff 1 18

5 Microfinance Workshop Board members 1 26

6 One day Workshop on MF of Field Assts. Field Assistants 19 552

7 Ratio Analysis Training Managers 1 11

Total 25 733

D. MFIs’ In-house Client Training Programs


No. of Participants

1 Centerchiefs Workshop Centerchiefs 207 12422

2 Pre-Group Training Members/Clients 567 12372

3 Refresher Training Members/Clients 1205 29242

4 Skill Development Program Members/Clients 31 942

Total 2,010 54,978



RMDC Loan Portfolio with POsAs of July 15, 2012

S.N. Partner's Name Approved Loan (Rs.)

Disbursed Loan (Rs.)

Outstanding Loan (Rs.)

1 Nirdhan Utthan Bank Ltd., Bhairahwa 530,000 450,000 125,950

2 Centre for Selfhelp Development (CSD), Kathmandu 270,000 270,000 -

3 Bindhabasini Savings & Credit Cooperative, Banepa, Kavre 18,000 3,000 500

4 Nepal Rural Development Society Centre (NRDSC), Biratnagar 144,755 144,755 -

5 Sahara Nepal Savings & Credit Cooperative Ltd., Charpane, Jhapa 541,595 511,595 103,190

6 National Educational and Social Development Organization (NESDO), Parbat 306,755 226,755 76,305

7 Chartare Yuwa Club (CYC), Baglung 170,425 130,425 62,320

8 Society of Local Volunteers' Effort (SOLVE), Dhankuta 65,000 62,500 31,648

9 Rural Awareness Forum (RAF), Baglung 2,000 1,400 -

10 Dhaulagiri Community Resources Development Centre (DCRDC), Baglung 37,000 27,000 -

11 Community Women Development Centre (CWDEC), Rajbiraj, Saptari 76,695 58,695 2,305

12 Mahuli Community Development Centre (MCDC), Mahuli, Saptari 235,060 212,060 73,880

13 Deprosc Laghubitta Bikas Bank Ltd., Bharatpur 85,000 85,000 28,560

14 Paschimanchal Grameen Bikas Bank Ltd., Butwal 40,000 40,000 -

15 UNYC Nepal, Bardiya 99,950 83,950 32,674

16 Chhimek Laghubitta Bikas Bank Ltd., Hetauda 498,100 463,600 140,720

17 Madhyamanchal Grameen Bikas Bank Ltd., Janakpur 40,000 40,000 -

18 Swabalamban Laghubitta Bikas Bank Ltd., Janakpur 451,000 451,000 66,000

19 Manushi, Gyaneswor, Kathmandu 150,000 136,000 48,495

20 Nepal Mahila Utthan Kendra, Lalitpur 44,520 44,520 -

21 Jeevan Bikash Samaj, Amahibariyati, Morang 583,420 563,417 188,964

22 Forum for Rural Women Ardency Development (FORWARD), Sunsari 662,065 589,600 168,810

23 Mahila Sahayogi Cooperative Ltd., Balaju, Kathmandu 85,820 70,820 28,470

24 Srijana Samudaik Bikas Kendra, Choharwa, Siraha 176,500 146,500 55,826

25 Nepal Mahila Samudayik Sewa Kendra, Ghorahi, Dang 101,200 95,200 33,730

26 Srijana Bikash Kendra, Pokahra 120,800 120,800 51,500

27 Women Entrepreneurs' Association of Nepal (WEAN), Kathmandu 14,000 10,000 -

28 Royal Cooperative Ltd., Syangja 6,435 5,435 -

29 Social Welfare Action Nepal (SWAN), Dang 3,000 100 -

30 SUPER, Dang 3,000 3,000 -

31 Grameen Mahila Bikas Sanstha, Dang 2,500 300 -

32 Nawapratibha Savings & Credit Cooperative Ltd., Nawalparasi 96,900 66,900 22,185

(Rs. in ‘000’)

Annex III

63






33 Grameen Mahila Utthan Kendra, Dang 78,590 48,590 22,926

34 Karnali Savings & Credit Cooperative Ltd., Jhapa 55,600 55,600 6,450

35 Sewa Savings & Credit Cooperative Ltd., Itahari 19,700 19,700 2,300

36 Gorkha Gharelu Savings & Credit Cooperative Ltd., Gorkha 765 200 -

37 Shramjivi Savings & Credit Cooperative Ltd., Lahan, Siraha 84,800 82,800 12,530

38 Indragram Punarmilan Savings & Credit Cooperative Ltd., Narayanghat 25,400 24,400 7,071

39 Ideal Cooperative Ltd., Rajbiraj, Saptari 4,400 4,400 -

40 Navodaya Multipurpose Cooperative Ltd., Topgachhi, Jhapa 52,000 43,000 16,020

41 Bouddha Grameen Savings & Credit Cooperative Ltd., Surkhet 46,700 41,700 21,755

42 Batawaran Sudhar Multipurpose Cooperative Ltd., Surkhet 94,225 80,725 46,579

43 Kalika Multipurpose Cooperative Ltd.,Rasuwa 18,400 17,200 6,326

44 Gaurishankar Development Bank Ltd., Nawalparasi 20,000 5,576 -

45 Mahila Upkar Manch, Kohalpur, Banke 34,200 29,700 16,500

46 Triveni Bikas Bank Ltd., Narayanghat 20,000 20,000 -

47 Palpa Rara Savings & Credit Cooperative Ltd., Palpa 3,800 3,800 306

48 Krishak Jagaran Cooperative Ltd., Lamjung 39,800 39,800 2,500

49 Udayadev Multipurpose Cooperative Ltd., Mahendranagar, Kanchanpur 23,650 21,150 9,200

50 Palung Multipurpose Cooperative Ltd., Palung, Makwanpur 12,200 12,200 2,715

51 Karnali Bikas Bank Ltd., Nepalganj, Banke 10,000 - -

52 Excel Development Bank Ltd., Birtamod, Jhapa 16,000 1,881 -

53 Patan Business & Professional Women, Pulchowk, Lalitpur 3,000 100 -

54 Chameli Savings & Credit Cooperative Ltd., Lalbandi, Sarlahi 4,600 100 -

55 Gangamala Savings & Credit Cooperative Ltd., Chhinchu, Surkhet 19,600 19,600 8,615

56 Bageswori Dev.Bank Ltd., Nepalganj, Banke 10,000 6,797 -

57 Maitri Multipurpose Cooperative Ltd., Tamghas, Gulmi 13,425 13,425 7,228

58 Siddhartha Dev.Bank Ltd., Butwal, Rupandehi 20,000 20,000 -

59 Andhakar Mukti Savings & Credit Cooperative Ltd., Rampur, Palpa 31,000 31,000 20,447

60 Nerude Laghubitta Bikas Bank Ltd., Biratnagar 660,480 540,480 149,502

61 Silsila Multipurpose Cooperative Ltd., Argakhachi 2,500 100 -

62 Digo Kosh Shanchalan Savings & Credit Cooperative Ltd., Rolpa 1,000 100 -

63 Himchuli Bikas Bank Ltd., Pokhara, Kaski 20,000 6,974 1,452

64 Kisan Multipurpose Cooperative Ltd., Lamki, Kailali 82,000 52,000 24,710

65 Pashminchal Development Bank Ltd. Butwal, Rupandehi 20,000 20,000 -

66 Small Farmer Agri. Cooperative Ltd. Dumbarwana (SFCL), Bara 50,000 50,000 19,160

67 Digre Saikumari Savings & Credit Cooperative Ltd., Khalanga, Rukum 8,000 3,000 275

68 Biswasilo Savings & Credit Cooperative Ltd., Thakurdwara, Bardiya 10,000 6,000 3,453






69 Pragati Savings & Credit Cooperative Ltd., Tharamare, Salyan 5,800 4,300 2,868

70 Samudayik Savings & Credit Cooperative Ltd., Khalanga, Rukum 3,000 - -

71 Muktinath Bikas Bank Ltd., Prithvichowk, Pokhara 280,165 280,165 107,390

72 Kalyankari Savings & Credit Cooperative Ltd., Lubhu, Lalitpur 12,000 6,000 260

73 Kola Samaiji Mahila Bikas Multipurpose Cooperative Ltd., Samaiji, Dadeldhura 500 - -

74 Nayapati Savings & Credit Cooperative Ltd., Nayapati, Kathmandu 35,000 13,500 620

75 Deurali Multipurpose Cooperative Ltd., Ishaneswor, Lamjung 12,000 12,000 6,260

76 Small Farmer Agri. Cooperative Ltd. Semlar, (SFCL), Rupandehi 36,000 23,000 12,132

77 Small Farmer Agri. Cooperative Ltd. Parroha, (SFCL), Rupandehi 29,000 21,000 10,385

78 Janahitkari Savings & Credit Cooperative Ltd., Birendranagar, Surkhet 2,500 2,192 102

79 Shreejana Cooperative Ltd., Kohalpur, Banke 1,000 - -

80 Kasturi Multipurpose Cooperative Ltd., Khalanga, Jajarkot 500 300 55

81 Himchuli Agri.Cooperative Ltd., Manma, Kalikot 500 500 335

82 Hatemalo Savings & Credit Cooperative Ltd., Binayek, Accham 500 500 89

83 Bhimkul Savings & Credit Cooperative Ltd., Borlang, Gorkha 2,500 2,500 704

84 Laliguras Multipurpose Cooperative Ltd., Byas, Tanahu 2,500 2,500 955

85 Shuvakamana Multipurpose Cooperative Ltd., Dulegauda, Tanahu 5,000 - -

86 Lalima Multipurpose Cooperative Ltd., Bhalbari, Rupandehi 2,000 800 200

87 Manakamana Mai Multipurpose Cooperative Ltd., Abukhairani, Tanahu 4,000 - -

88 Arthik Bikas Saving and Credit Cooperative Ltd., Panchkhal, Kavre 3,000 1,000 325

89 Bikas Multipurpose Cooperative Ltd., Butwal, Rupandehi 5,000 3,200 1,525

90 Kedarnath Saving and Credit Cooperative Ltd., Dhari-5, Darchula 1,700 900 630

91 Jana Kalika Saving and Credit Cooperative Ltd., Dehimandu, Baitadi 500 500 380

92 Mahila Kalyan Saving and Credit Cooperative Ltd., Chainpur-1, Bajhang 500 400 327

93 Marshyandhi Multipurpose community Cooperative Ltd., Abukhairani, Tanahu 3,000 3,000 2,460

94 Shreejanshil Saving and Credit Cooperative Ltd., Jhalari, Kanchanpur 3,000 3,000 2,460

95 Small Farmer Agr. Coop. Ltd., Triveni, Nawalparasi 5,000 - -

96 Mahila Kalyan Saving and Credit Cooperative Ltd., Aambhanjyang, Makawanpur

3,000 500 375

97 Kawaswoti Social Entrepreneur Women Cooperative Ltd., Kawaswoti, Nawalparasi

3,500 1,500 1,438

98 Shantikunj Social Entrepreneur Women Cooperative Ltd., Ratnanagar, Nawalparasi

2,500 800 750

99 Agyauli Samajik Uddhyami Mahila Cooperative Ltd., Danda, Nawalparasi 2,000 800 750

100 Small Farmer Agriculture Coop. Ltd., Khadawabangai, Rupandehi 5,000 1,250 1,250

101 Bishazari Samajik Uddhyami Mahila Cooperative Ltd., Geetanagar, Chitwan 2,500 400 400

102 Unnati Saving & credit Cooperative Ltd., Pokhara, Kaski 10,000 - -

7,761,995 6,822,932 1,905,476

65



Annex IV

Yearwise Loan Portfolio of RMDC

(Rs. in Million)

Fiscal Year Loan Approved Loan Disbursed Loan Recovered Loan Outstanding

1999-00 40.0 40.0 - 40.0

2000-01 32.1 1.9 26.7 15.2

2001-02 132.7 66.0 23.9 57.3

2002-03 116.5 137.1 73.4 120.9

2003-04 123.2 118.8 106.3 133.5

2004-05 382.8 320.7 128.3 325.8

2005-06 357.8 298.2 123.2 500.9

2006-07 1,143.7 961.1 326.9 1,135.0

2007-08 800.3 525.0 405.6 1,254.4

2008-09 903.2 845.2 599.5 1,500.1

2009-10 1,539.7 1,201.9 779.8 1,922.2

2010-11 1,118.4 1,298.0 979.3 2,240.9

2011-12 1,071.7 1,009.2 1,344.6 1,905.5

Total 7,762.0 6,822.9 4,917.4



Ann

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2

S.N

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Total Staff

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Savings Balance

Loan Disbursed (Cumulative)

Outstanding Loan

Overdue Loan

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Outstanding Loan per Borrower

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S.N

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Staff Biographies

Mr. Shankar Man Shrestha - 66, has been working as the Chief Executive Officer of RMDC since August 1999. Prior to joining RMDC, he was Executive Director of CSD, an NGO, from August’91 to July’99. He is also the founder member of that national NGO, which is one of the premier microfiance institutions in Nepal. Before that, he worked with the Agriculture Development Bank of Nepal (ADBN) for 25 years. In ADBN, he had worked in various positions such as Deputy General Manager, Director of Training, Chief of Loan Department, Regional Manager. As regards to his academic qualification, he has B.A (Hons), Master of Arts in Economics from Tribhuvan University (TU) Nepal. He has also completed a Special Study in Agriculture Economics from Texas A. & M. University, USA. Mr. Shrestha has participated in numerous training, workshops, seminars and conferences organized by national and international agencies such as ADB, Rabobank of Netherland, APRACA, APDC, USAID, JICA, Microcredit Summit Secretariat, Grameen Bank, Grameen Trust on rural development and on areas such as agriculture banking, microfinance, small farmer credit, etc. He also participated as consultant in the project missions of ADB, IFAD, JICA and IDRC. While in ADBN, he was involved in the implementation of the Agriculture Credit Project of ADB, the Small Farmer Development Project of ADB and IFAD, and the other projects supported by GTZ, KFW, World Bank, USAID, CIDA, etc. Mr. Shrestha has been writing on issues of microfinance for long and are published widely in journals/magazines within the country and abroad. He has also presented a number of papers and participated as a speaker/panelist/resource person in different international conferences on microfinance and poverty alleviation (such as Regional and Global Microcredit Summits, Country Level Summits) held in Bangladesh, China, Turkey, Pakistan, India, USA, Canada, Vietnam, Srilanka, Spain.

Annex VI

Mr. Megh Raj Gajurel - 58, is chief of the Financial Management Department of RMDC. He joined the organization as a Manager in November 1999. Before joining RMDC, he worked for ADBN for 21 years and for the Nepal Credit and Commerce Bank (then Nepal Bank of Ceylon Ltd.) for more than 2 years. His academic qualification is Master in Public Administration from TU, Kathmandu. He is accredited as fully certified trainer of the Microfinance Training of Trainers, a distance learning course jointly organized by ADBI, World Bank TDLC and UNCDF. The major trainings he has acquired are: I) Loan Appraisal, organized by MAC Consultants, ii) Cooperative Society Management, organized by CICTAB in India, iii) Project Appraisal, organized by ADB/N, iv) Financial Analysis and Delinquency Management, organized by EDA Rural Systems in Hyderabad, v) Effective Management of Microfinance Institutions, organized at ILO International Training Centre, Italy, vi) study visit to PKSF, Grameen Bank, ASA, IDF of Bangladesh, vii) Credit Appraisal of Microfinance Institutions, organized by EDA Rural Systems Pvt. Ltd. Delhi, viii) ToT on Quality Training for MFIs organized jointly by Asian Institute of Management & Citigroup in Philippines, ix)Managing Customer Complaints, organized by Kathmandu University, x) Workshop on Auditing of MFIs, organized by Grameen Trust Bangladesh, xii) Developing Project Proposals conducted by ELD Lalitpur and xiv) Study visit to German Savings Banks Finance Group organized by Savings Banks Foundation for International Cooperation (SBFIC), Germany. Besides, he has participated in the Asia Pacific Region Microcredit Summit held in Dhaka in 2005 and presented a paper on “Challenges in Microfinance – Both in Agriculture and in the areas with low density of population” in the summit held in Bali, Indonesia in 2008.



Mr. Tirtha Ratna Konajo - 55, is chief of the Planning and Research Department of RMDC. He joined the organization as a Manager in November 1999. Before joining RMDC, he worked with the Nepal Bank Limited for 14.5 years and Himalayan Bank Ltd. for more than 3.5 years. His academic qualification is Master in Business Administration and Commerce from TU, Kathmandu The major trainings he has acquired are: i) Commercial Banking Management, conducted by Nepal Rastra Bank, ii) Financial Statement Analysis, conducted by Ernst and Young, Singapore in Kathmandu, iii) Credit Recovery and Management, conducted by Booze Allen & Hamilton, U.S.A Group in Kathmandu, iv) Faculty Development Program, conducted by Reserve Bank of India in Bombay, v) Study Visit to PKSF, Grameen Bank, ASA and IDF in Bangladesh, vi) Financial Analysis and Delinquency Management, conducted by EDA Rural System in Hyderabad, vii) Business Planning with Microfin, conducted by EDA Rural System in Delhi, viii) Community-Based Micro-Finance and Income Generation Management for Poverty Alleviation, organized in Bangkok, Thailand, ix) Management Information System for MFIs, organized by EDA Rural Pvt. Ltd, x) Training of Trainers Course on Financial Analysis for MFIs, conducted by EDA Rural Pvt. Ltd.,India, xi) Reporting Skills and Professional Writing, conducted by ELD, Lalitpur xii) Microfinance Training of Trainers Blended Learning Course, jointly organized by ADB, Institute, African Development Bank and Tokyo Development Learning Centre, The World bank and accredited as fully certified trainer of the microfinance distance learning course and xiii) Commercial Micro Banking Training organized by Frankfurt school of Finance and Management, Frankfurt, Germany. Besides, he has participated in several other workshops, seminars and exposures related to microfinance and wholesale financing and is experienced trainer of Financial Analysis and Delinquency Management training.

Mr. Ram Dayal Rajbanshi - 52, is chief of the Microfinance Service Department of RMDC. He joined the organization as a Manager in October 1999 and worked as chief of the Institutional & Social Development Department until June 2009. Before joining RMDC, he worked with GTZ as an Economic Promotion Specialist for a poverty alleviation project for 20 months; with Deprosc as Project Managers for the Community-Based Economic Development Project, Dadeldhura and Micro-credit Project, Morang for 20 months; with Bank of Maldives Ltd., the Republic of Maldives as a UNV Specialist (Development Banking) for 2 years; with ADBN as a Credit Officer for about 7 years; and with Agriculture Extension and Research Project as an Agricuture Training Officer for 3 years. He holds M.A. in International & Development Economics from the University of San Francisco, USA and M.Sc. in Rural Regional Planning from AIT, Thailand. He has been awarded with the University Vice-Chancellor Gold Medal for having stood first in the examination of Bachelor degree in 1982. The major trainings he has acquired are: i) Training of Trainers Course on Financial Analysis for MFIs, conducted by EDA Rural P. Ltd.,India, ii) Quality Training for Microfinance Institutitons, conducted by Citigroup/AIM, Manila, iii) Middle Management Program, conducted by IIM, Ahmedabad, iv) study visit to PKSF, Grameen Bank, ASA and BRAC in Bangladesh, v) Training of Trainers Course on Delinquency Management & Interest Rate Setting, conducted by EDA Rura Pvt. Ltd., India, vi) Microfinance Donor Seminar: From Donations to Investments, conducted by UNCDF/CGAP in Phnom Penh, vii) Accountancy course conducted by MAC Consultants Pvt. Ltd. Kathmandu, viii) Non-Formal Education, conducted at the Center for International Education, Massachusetts, USA, ix) Boulder Microfinance Training, Turin, Italy and x) Program in Computer Applications Development, AIT, Bangkok.



Mr. Pritha Bahadur Thapa - 42, is a Manager at the Microfinance Service Department of RMDC. He joined the organization as an Officer in June 2000. Just before joining RMDC, he worked with CSD as Chief of Rural Finance Sector of CBED project, Jumla for 30 months and as Program Supervisor of Self-help Banking Program for 6 months. His academic qualification is Master in Business Administration from TU, Nepal. The major trainings he has acquired are: i) Grameen Generalized System, organized at Grameen Trust, Bangladesh ii) Financial Analysis and Delinquency Management, conducted by EDA Rural System in Hyderabad, iii) Audit of MFIs, conducted by Grameen Bank, Bangladesh, iv) Training of Trainers Course, organized by CECI, Kathmandu, v) Facilitation Skill, conducted by ICA, Kathmandu vi) Institutional Development of Savings and Credit Organization, organized by CECI, vii) Operational Procedures, Supervision and Monitoring System of MFIs, organized at PKSF, Bangladesh, viii) Credit Appraisal of Microfinance Institutions, organized by EDA Rural Systems Pvt. Ltd., India ix) Study visit to PKSF, Grameen Bank, ASA and IDF of Bangladesh, (x) Credit and Risk Management, organized by the Citigroup and the Asian Institute of Management (AIM) in Manila (xi) Training of Trainers organized by RMDC, Kathmandu, (xii) Microfinance Training of Trainers Blended Learning course, jointly organized ADB, Institute, African Development Bank and Tokyo Development Learning Centre, The World Bank and accredited as fully certified trainer of the microfinance distance learning course, xiii) Participated in SAARC Finance Seminar “Targeted Credit Program in SAARC Region” organized by Central Bank of Nepal, xiv) Participated in Asia Microfinance Forum 2010, Colombo, Srilanka and xv) Exposure visit to German Savings Banks Finance Group organized by Savings Banks Foundation for International Cooperation (SBFIC), Germany. Besides, he has expertise in facilitating microfinance workshops and preparing business plan for MFIs.

Ms. Annapurna Shrestha - 42, is chief of the Institutional and Social Development Department and Human Resource Management Department of RMDC. She joined the organization as an Officer in June 2000. Before joining RMDC, she worked with the CSD, Kathmandu for four years. Her academic qualification is Bachelor of Arts from TU, Kathmandu. The major trainings she has acquired are: i) Operational Procedures, Supervision and Monitoring System of MFIs, organized at PKSF, Bangladesh, ii) Disbursement and Project Management, conducted by ADB in Kathmandu, iii) Training of Trainers, conducted by Institute of Cultural Affairs (ICA), Kathmandu, iv) Facilitation Skill, conducted by ICA, Kathmandu, v) Grameen Management Training on Grameen Banker International, conducted at Grameen Bank, Bangladesh, vi) Participatory Monitoring and Evaluation, conducted by ELD, Kathmandu, vii) study visit to the Grameen Bank, ASA and IDF in Bangladesh, viii) Financial Analysis and Delinquency Management organized by RMDC, ix) Credit and Risk Management, organized by the Citigroup and AIM in Manila, x) Training on Developing Assertiveness organized by the Kathmandu University xi) Prudential Banking Regulations, organized by MAC Consultants (P.) Ltd. xii) The Boulder Microfinance Training in Turin, Italy organized by The Boulder Institute of Microfinance & The International Training Centre of the ILO, xiii) Workshop on Gender Entrepreneurship and Economic Empowerment to South Asia organized by Asian Development Bank, xiv) Second National HR Conference organized by NBTI, Kathmandu and xv) Study visit to German Savings Banks Finance Group organized by Savings Banks Foundation for International Cooperation (SBFIC), Germany. Besides, she has expertise in organizing study visits, workshops, conferences, national & international training programs.



Mr. Roop Bahadur Khadka - 46, is chief of the Internal Audit and Supervision Department of RMDC. He joined the organization as an Officer in June 2000. Before joining RMDC, he worked with the Far Western Rural Development Bank, Dhangadhi for six years. His academic qualification is Bachelor of Commerce (Audit) from Bombay University, India. The major trainings he has acquired are: i) Operational Procedures, Supervision and Monitoring System of MFIs, organized at PKSF, Bangladesh, ii) Disbursement and Project Management, conducted by ADB, Kathmandu iii) Training of Trainer’s Course on Supervision of MFIs under Second-Tier Institution, organized by NRB, Kathmandu, iv) Audit of MFI, conducted by Grameen Bank, Bangladesh, v) Financial Analysis and Delinquency Management, organized by RMDC, vi) Visual Basic 6 Programming, conducted by CSE, Kathmandu, vii) Credit Appraisal of Microfinance Institutions, organized by EDA Rural Systems Pvt. Ltd.,India, viii) Review Workshop on Tax Act, 2058, organized by MAC Consultants, Kathmandu, ix) Monitoring & Supervision of MFIs, conducted by PKSF, Bangladesh, x) Participatory Monitoring & Evaluation, conducted by ELD, Kathmandu, xi) Study visit to Grameen Bank, ASA and IDF, organized by IDF, Bangladesh xii) Internal Audit of MFIs, conducted by EDA Rural Pvt. Ltd. Delhi xiii) Training of Trainers conducted by ELD, Kathmandu, xiv) Anti-Money Laundering Workshop, organized by Nepal Rastra Bank xv) Training on International Financial Reporting Standards (IFRS), conducted by Accounting Standard Board (ADB) Kathmandu, xvi) Operational Management of Microfinance focusing on Non- interest based microfinance, organized by Colombo Plan, Govt. of Indonesia & NAM CSSTC, Indonesia, xvii) National HR Conference 2011, organized by NBTI, Kathmandu and xviii) Observation visit to German Savings Banks Finance Group organized by Savings Banks Foundation for International Cooperation (SBFIC), Germany. Besides, he has expertise in accounting, supervising and auditing of MFIs, and facilitating training programs.

Mr. Basu Dev Lamichhane - 44, is a Senior Officer at the Supervision Department of RMDC. He joined the organization on 16th July 2004. Before joining RMDC, he worked with the Rastriya Banijya Bank (particularly for the Priority Sector Credit Program) for 17 years as Senior Assistant. His academic qualification is MBA from TU, Nepal. The major trainings he has acquired are: i) Training on Production Credit for Rural Women, organized by Women Development Training Centre , Kathmandu, ii) Priority Sector Credit Program, organized by Nepal Rastra Bank, iii) Small Business Consultancy Course, organized by SBPP/GTZ, iv) Management Development Program, organized by RMDC, v) Credit Appraisal of MFIs, conducted by EDA Rural Pvt. Ltd. Delhi, India vi) Trainer Development Program, organized by RMDC, vii) Financial Analysis and Delinquency Management, organized by RMDC viii) Training on Grameen Generalized System, jointly organized by the Grameen Trust, Bangladesh and RMDC, Nepal ix) Training on Facilitation and Presentation Skills organized by ELD, Lalitpur and x) Training on Sri Lankan off-Grid Micro-Hydro Financing System, Sri Lanka, organized by ESAP/AEPC.



Mr Bhola Nath Regmi - 38, is a Senior Officer at the Microfinance Service Department of RMDC. He joined the organization as an Officer on 1st September 2005. Before joining RMDC, he worked with the Nepal Commerce Campus, Minbhawan as an Assistant Lecturer for five years and with National Human Rights Commission of Nepal as an Accountant for 5 months. His academic qualification is Master in Business Administration (Financial Management) from TU, Nepal. The major trainings he has acquired are : i) Management Development Program, organized by the Ministry of Local Development, ii) Financial Analysis and Delinquency Management, organized by Sana Kisan Bikas Bank Ltd, iii) Credit Appraisal of MFIs, organized by EDA Rural System Pvt. Ltd. Delhi, iv) Training on Grameen Generalized System, conducted jointly by RMDC & Grameen Trust, Bangladesh, v) Study Visit to Grameen Bank, ASA and IDF of Bangladesh, vi) Trainer Development Program, organized by RMDC vii) Training on Gender organized by the Department of Livestock, Nepal, viii) Training on ‘Facilitation and Presentation Skills’ conducted by ELD, Lalitpur, ix) Training of Trainers (ToT) conducted by ELD, Lalitpur, x) Training on Business Planning conducted by RMDC, xi) Training of Trainers (ToT) organized by RMDC and xii) Microfinance Training of Trainers Blended Learning course, jointly organized ADB, Institute, African Development Bank and Tokyo Development Learning Centre, The World Bank and accredited as fully certified trainer of the microfinance distance learning course.

Mr. Anil Krishna Joshi - 43, is a Senior Officer at the Human Resource Management Department of RMDC. He also works as a Company Sectretary of RMDC. He joined RMDC in October 1999 as a Senior Assistant. Before joining RMDC, he worked with the Institute for Integrated Development Studies (IIDS), Kathmandu for 6 years as a Data Processor. His academic qualification is Masters in Business Administration from TU, Nepal. The major trainings he has acquired are: i) Auditing & Supervision of Partner MFIs, conducted by PKSF, Bangladesh, ii) Organization Behavior, conducted by Nepal Rastra Bank, Kathmandu, iii) Accounting Training, conducted by Chartered Academics International, Kathmandu, iv) Credit Appraisal of MFIs, conducted by EDA Rural Pvt. Ltd. Delhi, v) Training Program for Company Secretary, conducted by Institute for Law and Development, Kathmandu, and vi) Training of Trainers organized by RMDC, Kathmandu.



Ms. Gyanu Maya Bhandari - 34, is a Senior Officer at the Planning and Research Department of RMDC. She joined the organization as an Officer on 1st September 2005. Before joining RMDC, she worked with P.L. Shrestha & Co., Chartered Accountants (member of HLB international) for 1 year as an Audit Officer. Her qualification is CA Intermediate from The Institute of Chartered Accountants of Nepal. The major trainings she has acquired are: i) Basic Computer Training, conducted by Oxford Computer Institute, Kathmandu, ii) Accountancy, conducted by MAC Consultants Pvt. Ltd, Kathmandu, iii) Financial Analysis and Delinquency Management, organized by RMDC, iv) Credit Appraisal of Microfinance Institutes, conducted by EDA Rural Pvt. Ltd. Delhi, v) Trainer Development Program, organized by RMDC, vi) Training of Trainers (ToT) conducted by RMDC, Kathmandu, vii) Reporting skills and Professional writing Training conducted by ELD, Lalitpur, viii) Training on Design and Development of Training Material, jointly organized by InM Bangladesh and AIT Thailand and ix) Study Visit to Grameen Bank, ASA and IDF of Bangladesh.

Mr. Pradeep Kumar Poudel - 34, is an Officer at the Microfinance Service Department of RMDC. He Joined RMDC on June 15, 2006 as an Assistant and since then he has been working under the department. His academic qualification is Bachelors Degree in Management from TU, Nepal. The major training he has acquired are: i) Advanced Accounting Training, Conducted by MAC Consultants, Kathmandu, ii) Secretarial Training, conducted by MMSI, Kathmandu, iii) Data Base Programming, conducted by Computer Point Nepal, iv) Study visit to Grameen Bank, ASA, and IDF of Bangladesh v) Training of Trainers (ToT) conducted by ELD, Lalitpur and vi) Financial Analysis & Delinquency Management conducted by RMDC.



Mr. Jaya Ram Khadka - 34, is an officer at Microfinance Service Department of RMDC. He joined the organization as an officer on 15th April 2010. His academic qualification is Masters in Business Studies (MBS) from Tribhuwan University, Nepal. The major trainings he acquired are: i) Financial Analysis and Delinquency Management conducted by RMDC ii) Professional Accountant Training conducted by Chartered Academics International iii) Advanced Diploma in Software Technology (ADST) conducted by Computer Point Nepal, iv) Business Planning Training conducted by RMDC, v) Training on Design and Development of Training Material, jointly organized by InM Bangladesh and AIT Thailand, vi) Training on Case Study Writing conducted by ELD, Lalitpur and vii) Microfinance Training of Trainers Blended Learning course, jointly organized ADB, Institute, African Development Bank and Tokyo Development Learning Centre, The World Bank and accredited as fully certified trainer of the microfinance distance learning course.

Mr. Gobinda Prasad Poudel - 29 is an officer at the Financial Management Department of RMDC. He joined RMDC as an officer on 15 April 2010. Before joining RMDC, he worked with the Valley College of Technical Sciences, Kathmandu as an Accountant for one year and with P & P Associates (Insurance Loss Assessor), Kathmandu as an Assistant Loss Assesor for 2 years. His academic qualification is Master in Business Studies from TU. The major trainings he has acquired are: i) Accounting Application Using Computer, conducted by ECTA Management Academy, Putalisadak. ii) Diploma in computer Application, conducted by Public Computer and Language Pvt. Ltd., Palpa, iii) Financial Analysis and Delinquency Management, conducted by RMDC.

Mr. Bharat Kumar Singh - 37, is an officer at Supervision Department of RMDC. He joined the organization as an officer on 13 June 2010. His academic qualification is Masters in Rural Development from Tribhuwan University, Nepal. He has worked in Nirdhan Utthan Bank Ltd for 6 years. The major trainings he acquired are: i) Training of trainers program on Information, education & communication conducted by Nirdhan Plan capacity building program ii) Training of trainer’s course on micro enterprise creation & development conducted by IEDC, iii) Management training program conducted by KUSOM, iv) Rural credit challenges for micro financial Institutions Conducted by NIRD, India v) Financial Analysis and Delinquency Management training conducted by RMDC vii) Internal Audit Training conducted by RMDC and viii) Monitoring and supervision Training conducted by RMDC.



RM

DC F

am

ily



Scale 1:2,000,000

Kilometres 40 20 0 40 80 120 160

Nepal

India

India

India

China

Districts Covered by Partner Organizations’

Districts under MFI Development

Rural Microfinance Development Centre Ltd.

Regional Grameen Bikas Bank

Microfinance Development Bank

FI-NGO

Development Bank

Co-operative

Far Western

Mid Western

Western

Central

Eastern

Legend

The spread of RMDC’s Partner Organizations





Rural Microfinance Development Centre Ltd.

P.O.Box 20789, Putalisadak, Kathmandu, NepalTel: 977-1-4268019, 4268020, Fax: 977-1-4247702E-mail: [email protected], Website: www.rmdcnepal.com

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Documents

Annual Report 2011-12. Annual Report 2011-12.pdf · Annual Report 2011-12 The Partner for Safe, Sensible & Sustainable Microfinance Promoter Shareholders and Shareholding Pattern