AusAID Regional Microfinance Support Facility

This concept paper proposes a microfinance support facility that will provide a central method for AusAID to expand outreach of poverty-targeted financial services in the Asia-Pacific region.

The paper states that access to financial services is critical for poverty reduction. Australia needs to be proactive in providing resources to address the problem of poor access to financial services in the Asia-Pacific region. The paper identifies the following areas for AusAID support to microfinance in the region:

• Supporting the enabling environment for inclusive financial services;
• Providing young/ expanding MFIs with access to capital;
• Building capacity and providing technical support;
• Supporting National Microfinance Apex Institutions.

The paper recommends a feasibility study as a first step to developing a support facility. It states that the proposed microfinance support facility would:

• Aim to reduce poverty in the Asia-Pacific region by providing the poor with access to appropriate and sustainable financial services;
• Work with MFIs, networks of MFIs and support organizations that target the poor;
• Offer capacity building support, technical assistance, loans and/or guarantees for on-lending, research, information dissemination and policy advice.