Viet Nam: Microfinance Sector Development Program

Sovereign Project | 42235-012 Status:

Summary

The key thrust of ADB assistance is to support the development of a market-oriented formal microfinance sector consisting of diversified financial institutions including commercial banks, financial cooperatives and microfinance institutions (MFIs), among others, that can provide a broad range of safe and affordable quality financial services to poor and low-income households and their microenterprises in a sustainable basis. ADB assistance focuses on (i) creating a policy environment conducive to microfinance, (ii) developing financial infrastructure, (iii) building viable institutions, and (iv) supporting pro-poor innovations.

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Procurement Documents

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Project Name Microfinance Sector Development Program
Project Number 42235-012
Country Viet Nam
Project Status
Project Type / Modality of Assistance Technical Assistance
Source of Funding / Amount
TA 7499-VIE: Microfinance Sector Development Program
Technical Assistance Special Fund US$ 500,000.00
Strategic Agendas Inclusive economic growth
Drivers of Change Governance and capacity development
Sector / Subsector

Finance - Inclusive finance

Gender Equity and Mainstreaming No gender elements
Description
Project Rationale and Linkage to Country/Regional Strategy The key thrust of ADB assistance is to support the development of a market-oriented formal microfinance sector consisting of diversified financial institutions including commercial banks, financial cooperatives and microfinance institutions (MFIs), among others, that can provide a broad range of safe and affordable quality financial services to poor and low-income households and their microenterprises in a sustainable basis. ADB assistance focuses on (i) creating a policy environment conducive to microfinance, (ii) developing financial infrastructure, (iii) building viable institutions, and (iv) supporting pro-poor innovations.
Impact A viable, market-based microfinance sector with diversified participation of financial institutions.

Project Outcome

Description of Outcome The PPTA will be implemented in two parts. Part I will carry out a sector assessment and prepare a sector development strategy. If the Government accepts the recommendations, adopts the strategy and seeks a loan, then Part II will commence to design a loan. Otherwise, the PPTA will close at the end of Part I.
Progress Toward Outcome
Implementation Progress
Description of Project Outputs

A Draft Microfinance Sector Assessment and Key Elements to the National Microfinance Sector Development Strategy have been prepared by the consultant team, and is currently being reviewed by the Government and ADB for finalization.

The PPTA final outputs will be (i) a report of sector assessment; (ii) a draft national sector strategy; (iii) a roadmap of ADB sector assistance program; and (iv) a proposed design of an ensuing loan. The PPTA will be implemented over 12 months from February 2010 - February 2011. Items (i) and (ii) will be done in Q1-early Q2, 2010, followed by item (iii) and then (iv).

Status of Implementation Progress (Outputs, Activities, and Issues)
Geographical Location Nation-wide

Safeguard Categories

Environment C
Involuntary Resettlement C
Indigenous Peoples C

Summary of Environmental and Social Aspects

Environmental Aspects
Involuntary Resettlement
Indigenous Peoples
Stakeholder Communication, Participation, and Consultation
During Project Design Several consultation missions were conducted in 2010 which helped in the formulation of the proposed MSDP loan: i.e. inception mission in April, consultation mission in August, review mission in November in April 2010. A PPTA workshop was also held in August 2010.
During Project Implementation The team of consultants assisted in the formulation of policy actions for the proposed MSDP loan, after detailed discussions wih the Govt.

Business Opportunities

Consulting Services

The PPTA will conduct a sector assessment of binding constraints to sector development. It will examine existing sector development policies, legal environment, regulatory and supervisory frameworks, institutional capacity (SBV, VBARD, VBSP, PCFs, MFIs, and NGO microfinance programs), and supportive infrastructures. It will also analyze the sector performance outcomes focusing on service provision quality, outreach, prices, efficiency, and sustainability in connection to the existing policy environment and institutional infrastructure. Based on the sector assessment, the PPTA will prepare a draft national sector development strategy to promote a viable market-based microfinance sector in Viet Nam and a sector roadmap of ADB operations to address short-, meium- and long-term plicy and institutional development priorities. The ensuing loan will be designed as the first operation of ADB sector roadmap.

The PPTA will require 11.5 person-months of international consultant services and 10 person-months of national consultant services, as follows:(i) International Microfinance Sector Development Specialist/Team Leader, 6 person months; (ii) International Financial Institution Strengthening Specialist, 4 person months; (iii) International Microfinance Legal specilaist, 1.5 person months; (iv) National Microfinance Specialist, 6 person months; and (vi) National Banking Speclialist, 4 person months

Responsible Staff

Responsible ADB Officer Eiichi Sasaki
Responsible ADB Department Southeast Asia Department
Responsible ADB Division Public Management, Financial Sector and Trade Division, SERD
Executing Agencies
State Bank of Vietnam
Mr Nguyen Vinh Hung
International Cooperation Department, State Bank of Viet Nam, Hanoi

Timetable

Concept Clearance 19 Oct 2009
Fact Finding 18 Nov 2009 to 24 Nov 2009
MRM -
Approval -
Last Review Mission -
PDS Creation Date 26 Nov 2009
Last PDS Update 14 Jul 2011

TA 7499-VIE

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
21 Feb 2010 18 Mar 2010 18 Mar 2010 25 Feb 2011 30 Jun 2012 -
Financing Plan/TA Utilization Cumulative Disbursements
ADB Cofinancing Counterpart Total Date Amount
Gov Beneficiaries Project Sponsor Others
500,000.00 0.00 0.00 0.00 0.00 0.00 500,000.00 21 Feb 2010 370,627.08

Safeguard Documents See also: Safeguards

Safeguard documents provided at the time of project/facility approval may also be found in the list of linked documents provided with the Report and Recommendation of the President.

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Evaluation Documents See also: Independent Evaluation

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Related Publications

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