Microfinance Institutions (MFIs) are such organizations that provide microfinance services. MFIs ranges from small non-profit organizations to commercial banks.
There are three types of Microfinance Institution Models in Nepal.
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Microfinance Development Banks (MFDBs)
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Grameen Bikas Bank: Government owned bank, which provides micro-finance services to rural poor women under guarantee without collateral.
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| b. |
Private Microfinance Development Bank: Private owned development bank, similar to Grameen Bikas Bank.
RMDC finances MFDBs along with commercial banks and finance companies under the Deprived Sector Lending (DSL) scheme. |
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Financial Intermediary NGOs (FINGOs)
FINGOs are registered under Institutions Registration Act 1977 and undertake limited banking transactions as per the provision of the Financial Intermediation Related Institutions Act 1999. FINGOs normally serve clients between 2000-3000 in numbers.
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Cooperatives
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Savings and Credit Co-operative(SACCOs)
SACCOs serves almost all the districts in Nepal and servers 50-200 members in general. These SACCOs are governed by Cooperative Laws. SACCOs are considered more suitable models for mountains and hills as they provide both financial and saving facility to clients with any hassle. Sana Kisan Bikas Bank Limited (SKBBL) provides financing to SACCOs with an interest rate of 9.5%.
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Small Farmers Cooperative Limited(SFCL)
SFCL is a member-managed multi-service cooperative formed to deliver financial as well as non-financial services to its members mostly in rural areas. SFCL provide service to farmers in rural region and its service is limited to single Village Development Council (VDC) serving round 500 household catering 200-700 clients within a community. SFCL provides financial loan in a wholesale and non-financial services like, social mobilization, trainings and technical support services.
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