Master of
Science in International Finance Management,
Taglenova Meruert,
Third year student specialty Accounting and
Auditing
Kostanay
State University (Kazakhstan)
Improvement
of development
microfinance
institutions in Kazakhstan
Today in the economic literature the concept of
"sustainability" is used in three senses. First is the sustainability
of the projects, which means enduring influence (impact) of the projects.
Second, the concept of "sustainable use of natural resources" means
their rational and careful use. Finally, the term "sustainable
development" includes not only the development of natural resources and
the environment, but also economic development and overall policy, all possible
levels of social development [1]. In the concept of "sustainability
projects" we are talking about the development of a competitive and
interconnected financial system.
A pioneer in the field of development and systematic orientation
strategy to stimulate development of the financial systems in developing
countries is Germany. The concept of development of the financial sector which
aims to develop the financial system as a whole and not in its individual
regions or individual target groups was already adopted in 1994 and wasupdated 2004.
More precisely, stimulationof the development of the financial system is
defined as follows: " ... to contribute to its development in the partner
countries is necessary to ensure sustainable growth and viability of the
financial system, and the interaction of all its elements as well as the
development and establishment of financial institutions that are able to
perform their functions." [9].
In accordance with the concept of one of the ministries of Germany (BMZ)
event on financial system reform introduced various tools of stimulation
depending on the complexity of the situation and on three levelsat the same
time.
Macro level affects monetary function of the financial system. There is
interaction between the macroeconomic policies of the state with its real economy.
This communication reflects the relationship between the real and financial
parts of the economy. This level applies to the functional / political
framework for financial institutions - as interest rate policy, banking law or
regulation of the financial market, which have a strong impact on the volume
and efficiency of financial institutions [2].
Meso level is the central point
for the development of the financial system and the financial sector includes
institutions that offer such services to financial institutions, such as
programs to improve the skills , trade unions / associations, programs to
refinance and loan guarantee [4].
In micro - or institutional level it is, on the one hand, the creation
of various types and forms of organization of financial institutions that are
competitive and efficient. On the other hand we are talking about the opening
of the microcredit market for those segments of the population that are not
serviced by domestic banks of the second level [1].
In the 2003, infinancial sector development conception of Kazakhstan,
which was a key focus of its optimization, the credit system is represented as
follows:
- First level - the commercial banks;
- Second level - non-bank financial institutions, credit unions and pawnshops;
- Third level - microcredit organizations (MCOs).
One of the participants of microcredit services was called second-tier
bank that operate microcredit both through its own sources and funded by
international financial institutions. It should be noted that microcredit takes
small share in the total aggregate loan portfolio of banks, but this kind of
banking services contributes significantly to the process of microfinance in
the country [3].
Microfinance institutions use a simplified procedure for granting loans
and non-traditional forms of collateral, such as group guarantees. This
financing mechanism is addressed primarily to those entrepreneurs, for whom,
for various reasons (lack of collateral, credit history, a solid package of
documents) access to traditional financial resources is limited, if not closed.
Therefore, a large number of small and micro businesses use the services of
microfinance institutions [8].
Distinctive features of microfinance in Kazakhstan determined socio-
economic context and the characteristics of the financial system. The main
positive factors include good performance of the banking sector, growth trends
in the industrial and agricultural sectors, etc.
Another distinguishing feature is the geographic and demographic
specifics of microfinance development in Kazakhstan. The most successful
examples of microfinance worldwide are Bolivia and Bangladesh,countries with
high population density. In contrast, the population of Kazakhstan is more than
15 million people living in the vast territory in 2725 km., indicating that
low-density in the country. Thus, further development of the microfinance
sector in Kazakhstan faced with a paradox [7].
With this speed of development of financial sector bank loans still
remain inaccessible to small and medium entrepreneurs. The current situation
creates conditions for further development of micro-credit as an integral part
of the financial system and strategies to improve the living standards of the
population (Fig. 1).
As seen in Figure 1 in the structure of Microfinance Organizations of
Kazakhstan there is a positive growth trend of the MOK, their share increased
from 10.27% in 2005 to 89.73% in 2013 among registered.
To further improvement of the conditions for the development of
micro-credit system we must solve the following key questions:
1. One of the major development challenges microcredit sector remains
inadequate funds of microcredit organizations. Way out of this situation would
be to create the country's apex organization that represents some kind of
wholesale institution to shift funds (grants, loans, guarantees) between
microfinance institutions. For investors and donors such apex institutions are
attractive because they allow you to not participate in the selection process
of microfinance institutions for further funding [8].
Figure 1. The dynamics of the development of microcredit organizations
in Kazakhstan.
Considering past experience on previous public funding microcredit programs,
the creation of an apex Institute and guarantee of its independence requires
some effort. Participation of international organizations, international
experts in this process could contribute to solving this problem and provide a
basis for setting up credentials and effective relationships [5].
2. In general, microcreditsystem solves a range of tasks - from
supporting the poor to encourage entrepreneurship. Small and medium-sized
businesses face unfair lending practices, i.e. a decrease of transparency of
the total cost of credit. They deserve protection of their interests from
unfair lending and sloppy business practices. To prevent these facts we need a systematic
development of financial education borrowers [6].
3. Microcredit as a tool for engaging the broadest sections of the
population in the small and medium business can be an important part of the
regional development program.
In order to promote the performance of microfinance institutions in rural
areas it has been proposed to adjust the taxable income so that credit unions
and microcredit organizations can reduce their taxable income by the amount of
income received from lending to rural areas. Adoption of preferential tax
treatment for microcredit organizations, lending the village will allow them,
given their mobility and accessibility, to expand the scope of financial
services in rural areas, thereby contributing to the development of not only
agriculture, but rural infrastructure as a whole [2].
4. Recently there has been a steady increase in the amount of
microcredit organizations, most of which do not carry out microcredit on the
main purpose and remain unclaimed. It is caused by insufficient regulation and
control of the segment and it is proposed to introduce a model of monitoring
the activities of the MCO. At present in the Republic of Kazakhstan a similar
mechanism operates in the implementation of an actuary in the insurance market [8].
Monitoring will focus on protecting the interests of consumers who cannot
independently analyze the financial soundness of the organization , and do not
have access to other financial institutions , to facilitate the establishment
and operation of stable, transparent and conscientious microcredit organizations
, prevention of fraud and financial crime , ensuring the security and access
microcredit industry [4].
5. One of the main problems of micro-credit organizations is the
formation of funds. Alternative source of funding can be used to raise capital
through the issuance of financial instruments, including bonds. Bond issue
legal entities organized in the form of LTD, does not contradict the law. However,
this provision does not apply to micro-credit organizations. Need to consider
and establish requirements to provide opportunities replenishment microcredit
organizations through the issuance of bonds. Bond issue will enhance the
attraction of funds from internal sources and solve the problem of financing
microcredit organizations [7].
Referens:
1. BMZ (2004): Sektorkonzept Finanzsystementwicklung,
BMZ Konzepte Nr. 124, Bonn.
2. Имашова Ж.
Д. Организация деятельности и правовая база микрокредитных
организаций //КазЭУ хабаршысы. - Алматы,
2011. - № 4. - С.144-149.
3. KfW (2004): Zur Berucksichtigung der
Nachhaltigkeit durch die KfW in Schlussprbfungen von Finanzsektorprojekten, Frankfurt.
4. Obey L. Financial Innovation in the Banking Industry. The Case of Asset
Securitization // Garland Publishing, Inc. N.Y. & London, 2012
5. Осиповская А.В. Микрофинансирование и его
роль в поддержке малого бизнеса //Банковское кредитование.- Москва, 2011.- №3.
- С. 6-7.
6. Пирская Е.В. Роль микрофинансовых
организаций в развитии малого
предпринимательства //Транзитная экономика. - Алматы, 2007. - № 3. - С.44-50.
7. Рыжов
А. Организация и структурирование сделок секьюритизации: роль
независимого финансового консультанта // Энциклопедия российской
секьюритизации, 2010.
8. Zeller, M. (2009): Evaluationskriterien fur
Mikrofinanzinstitutionen: Finanzielle Nachhaltigkeit, Erreichung дгтегег Zielgruppen und Einkommenswirkung, in: Ahrens (Hrsg.): Neue Ansfltze der theoretischen und empirischen
Entwicklungsforschung, S. 1-26.
9. Zimmermann, M. / Rostock, S. / Bals, Ch. (2004): Mikrofinanz:
Weltweites Erfolgsmodell, nur nicht in Deutschland?, GTZ: Eschborn,
Germannwatch e.V. (Hrsg.).