UNCDF in Myanmar

Photo 1Two MFI clients in the Ayeyarwady Region are working to produce bamboo baskets. UNCDF is working to reach last mile clients in the marginalized regions of Myanmar with affordable, quality and responsible financial services. Photo: UNCDF

Established in 1966, UN Capital Development Fund (UNCDF) is the UN’s capital investment agency for the world’s 47 least developed countries.  It creates new opportunities for poor people and their communities by increasing access to inclusive finance and investment capital. UNCDF provides seed capital – grants and loans – and technical support to help financial service providers reach more poor households and small businesses, and local governments finance the capital investments that will improve poor peoples’ lives. UNCDF programmes help to empower women, and are designed to catalyze larger capital flows from the private sector, national governments and development partners, for maximum impact toward the Sustainable Development Goals (SDGs).

UNCDF has been in Myanmar since 2012, with Making Access Possible (MAP) Financial Inclusion diagnostic & Financial Inclusion Roadmap (FIRM) providing the foundation for in-country interventions. MAP is a multi-country initiative to support financial inclusion through a process of evidence-based country diagnostics, which seeks to identify key drivers of financial inclusion and develop a clear-cut roadmap for the Government to enhance financial inclusion in the country.

UNCDF conducted the initial MAP diagnostic in Myanmar in 2014. This was followed by the development of a Financial Inclusion Roadmap, which was approved by the Government of Myanmar in 2015 and launched by the UN Special Advocate for inclusive finance, Queen Máxima of the Netherlands. To oversee the Roadmap implementation, an Inter-Ministerial Steering Committee (IMSC), chaired by the Deputy Minister of Ministry of Planning and Finance was established. UNCDF has been supporting the Financial Regulatory Department in their role as secretariat to support the Government/IMSC in monitoring the roadmap, developing strategic action plans and a monitoring and evaluation framework.

From 2012 to 2017, UNCDF implemented the MicroLead Expansion Myanmar, a programme that congregated leading financial service providers to became market leaders, crowd-in additional investment and positively influence the development of the microfinance and cooperative sectors. UNCDF kick-started 2 Microfinance Institutions (ASA & Alliance) and 1 Cooperative (ACCU), reaching more than 200,000 clients with saving-led financial services, majority of whom are women in rural areas.

Currently UNCDF is implementing the Expanding Financial Access (EFA) programme which aims to strengthen Myanmar’s financial sector and support the implementation of the Financial Inclusion Roadmap, particularly in institutional building and addressing critical market barriers. A core component of EFA is the Market Development Facility (MDF), a lending facility that aims to strengthen undercapitalized Microfinance Institutions (MFIs) operating in the country. MDF targets MFIs with high potential of growth and rural expansion, strengthening their capacity by providing loans, loan guarantees, and technical support to facilitate financial service expansion to marginalized areas.

Under EFA, UNCDF has been an advocate and a facilitator of digital finance, coordinating the establishment of the Digital Financial Services (DFS) Working Group under the IMSC, providing DFS trainings to regulators and MFIs, and advocating for an inclusive digital finance sector. UNCDF has also undertaken a series of gender-related investment and training activities with financial service providers (FSPs) in Myanmar. These include providing risk capital to FSPs to test and develop innovations that address the financial needs of women and their businesses, undertaking institutional assessments and technical assistance on gender, and mapping existing financial sector regulations to promote equal financial access between men and women. UNCDF is also working to support women’s economic empowerment in conflict and post conflict states in Myanmar.

Moreover, EFA also works in partnership with the regional Shaping Inclusive Finance Transformations (SHIFT) funding facility which aims to accelerate financial inclusion across the ASEAN region and the global CleanStart programme which focuses on clean energy solutions.

Do you know that:

Photo 2The National Financial Inclusion Forum organized along with MoPF in March 2018. Photo: UNCDF

-          UNCDF is the only UN organization that is mandated to focus on the Least Developed Countries (LDCs). Currently, UNCDF is working in 31 of the 47 LDCs, and supporting 833 local governments.

-          The goal of the Myanmar Financial Inclusion Roadmap 2015 was to increase financial inclusion, or access to formal, regulated financial services in Myanmar from 30% in 2014 to 40% by 2020. According to the 2018 MAP Refresh findings however, this goal was exceeded with financial inclusion now standing at above 40% as of 2018.

-          Still, there is more work to do with only 25% of the adult population being banked, and only 7% saving their money in a bank account. UNCDF will develop an updated version of the Financial Inclusion Roadmap which will set a framework for the financial sector development up to 2022.

-          Under MicroLead, over 5 Million USD was funded to kickstart and strengthen three FSPs, which have reached a total loan portfolio of 32 Million USD until 2017. Under MDF, there are currently 5 MFIs in the pipeline, which will be provided a financing of 1.6 Billion MMK in total to expand its business volume and outreach.

-          In a partnership with the regional programme SHIFT, UNCDF has funded WAVE Money in developing a financial literacy mobile gamification app, ‘Shwe Toe’ which was launched to the public in June 2018.



Read more at UNCDF Myanmar homepage