2 Billion MMK Funding Agreement to Drive Economic Growth of Women and Families in Both Urban and Rural Areas
BRAC Myanmar and Yoma Bank Signed an Innovative Funding Agreement
March 8, 2018
Yangon, Myanmar – March 8, 2018 – Yoma Bank and BRAC Myanmar Microfinance Company Limited (BRAC) signed a MMK 2 billion funding agreement in support of BRAC’s microfinance activities in Myanmar on 21st February. BRAC currently offers services to more than 64,000 families across the country, with an aggregate loan book of MMK 12 billion. BRAC started microfinance operations in Myanmar in 2014, to extend inclusive financial services for families living in poverty. BRAC focuses on women to promote the economic growth of households in both urban and rural areas, currently offering credit services through 42 branch offices. Yoma Bank is one of Myanmar’s largest banks with over 3,000 staff and 74 branches nationwide.
Yoma Bank has taken the lead to provide funding and currency hedging solutions to a rapidly expanding MFI sector since legislation introduced mid-2016 allows Myanmar banks to lend to microfinance institutions (MFIs). According to Teun van Vlerken, Credit Risk Consultant with Yoma Bank under the LIFT-supported Agribusiness Finance Program, the MFI product sets a new precedent in lending standards due to the absence of typical collateral in terms of land and buildings. “Cash flow-based lending, comprehensive legal documentation and a product structured to the client’s needs are leading the way in a landscape in which conventional asset-based finance is no longer sufficient to address the needs of Myanmar’s rapidly growing economy,” said Teun.
The new facility enables BRAC to reach out to an additional estimate over 4,000 families who receive small loans sized between MMK 150,000 and MMK 10 Million. “We believe that it is a great opportunity for Yoma Bank to partner with BRAC Myanmar to provide increased support to Myanmar’s women-owned micro businesses. We are especially pleased that our funding will improve the livelihoods of families that will benefit from having access to the formal financial system,” said the Advisor to the Chairman and CEO of Yoma Bank, Mr. Hal Bosher.
“The partnership between BRAC and Yoma Bank Limited is a timely step in building an inclusive financial sector in Myanmar. We are proud to work together in realizing the potential of people living in poverty.” – ATM Tariqul Islam, Country Representative, BRAC Myanmar Microfinance Company Limited.