UNNATI-Access to Finance (A2F), a project jointly implemented by Nepal Rastra Bank (NRB) and the United Nations Capital Development Fund (UNCDF) and funded by the Danish government under UNNATI Inclusive Growth programme, signed a technical assistance agreement with 13 banks and financial institutions (BFIs), here, today.
The pact was inked in the presence of NRB Deputy Governor Maha Prasad Adhikari and Chargé D’affaires of Embassy of Denmark in Nepal Jan Møller Hansen.
UNNATI-A2F has inked a pact with Century Commercial Bank, Chhimek Laghubitta Bikas Bank, Everest Bank, Forward Microfinance Bittiya Sanstha, Janata Bank Nepal, Jeevan Bikas Samaj (JBS), Laxmi Laghubitta Bittiya Sanstha, Nerude Laghubitta Bikas Bank, Nirdhan Utthan Bikas Bank, NMB Bank, Sana Kisan Bikas Bank, Society of Local Volunteers’ Effort (Solve Nepal) and Swabalamban Laghubitta Bikas Bank.
Under the agreement, UNNATI-A2F will provide technical support to its partner institutions’ assessment of management information system and upgrading of the system; training and capacity building for market research and product development for the agriculture sector; training and exposure visit on agriculture value chain financing; feasibility study for expansion of branches and branchless access points in remote areas and financial literacy for building capabilities of clients and potential clients.
UNNATI-A2F project has been working in the eastern development region, specifically in Ilam, Panchthar, Terhathum, Bhojpur, Dhankuta, Taplejung and Sankhuwasabha districts targeting groups of smallholder farmers and micro, small and medium enterprises (MSMEs), focusing on women and vulnerable groups in the rural areas.
It has been supporting financial institutions so that they can serve the agriculture value chain actors with appropriate financial products to create an enabling environment for smallholder farmers and MSMEs to invest in their value chain activities, which in turn can lead them towards a sustainable source of income and better livelihoods.
UNNATI-A2F has said that the partnership with the BFIs is for four years, that is, till September, 2018. Within the project period, the project has envisaged to reach a significant number of households providing support under the agreement.
Speaking during the agreement signing programme, NRB Deputy Governor Adhikari said the monetary policies and directives of the central bank have always been in favour of increasing rural and agricultural finance. “Access to finance is a part of strategy to successfully alleviate poverty and the use of innovations such as mobile banking and other commercially viable pro-poor products will be future options,” Adhikari said.
He also highlighted the current embargo situation and urged the BFIs to take this as an opportunity to review their lending system so that they could help the country become sustainable in generating products and services.
Upendra Poudel, president of Nepal Bankers’ Association, said the partnership will also lead the BFIs in adopting appropriate use of technology like mobile money and digital financial services that can help expand financial services to unreached areas of Nepal.
Binod Atreya, executive director of NRB’s Microfinance Promotion and Supervision Department and the national project director of UNNATI-A2F, said, the project together with the partnering financial institutions will be able to address the key bottlenecks and constraining factors that hinder the smooth flow of agriculture finance in rural areas. He further added that now the project has entered the main phase towards achieving expected results.