Papua New Guinea : Microfinance Expansion Project
ADB is helping rural communities in Papua New Guinea access financial services. The project will strengthen industry regulation and the capacity of lenders to deliver a wider range of financial services and products in rural areas, with a focus on lending to micro and small enterprises, and especially to women. The project will also support a large-scale financial literacy training program.
Project Details
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Project Officer
Hodge, Matthew W.
Pacific Department
Request for information -
Country/Economy
Papua New Guinea -
Sector
- Finance
| Project Name | Microfinance Expansion Project | ||||||||||||||
| Project Number | 44304-013 | ||||||||||||||
| Country / Economy | Papua New Guinea |
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| Project Status | Closed | ||||||||||||||
| Project Type / Modality of Assistance | Grant Loan |
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| Source of Funding / Amount |
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| Strategic Agendas | Inclusive economic growth |
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| Drivers of Change | Gender Equity and Mainstreaming Knowledge solutions Partnerships Private sector development |
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| Sector / Subsector | Finance / Finance sector development - Inclusive finance - Small and medium enterprise finance and leasing |
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| Gender | Effective gender mainstreaming | ||||||||||||||
| Description | The Project will support the further development of the microfinance sector in Papua New Guinea (PNG) through an integrated package of support, including six outputs. Outputs 1, 2 and 3 will strengthen the capacity of the microfinance industry to provide financial services to a broader cross-section of the community and strengthen the capacity of its clients and potential clients to utilize these financial services. Output 4 will provide appropriate regulation for, and supervision of, microfinance institutions (MFI) and savings and loan societies (SLS) through the Bank of PNG (BPNG). Output 5 will seek to increase lending to micro and small enterprises (MSE) to increase rural income generation. Output 6 will provide efficient and effective project management services to the Project. As a result participating financial institutions (PFIs) throughout PNG, which will be identified through a series of institutional assessments, will be better able to provide profitable, appropriate, reliable and safe financial services to financially literate clients and capable businesses. | ||||||||||||||
| Project Rationale and Linkage to Country/Regional Strategy | The Asian Development Bank (ADB) estimates that only approximately 15% of the population in PNG has access to formal or informal banking facilities, and that this is lower in rural areas. Lack of access to financial services is an impediment to the monetization of rural economies, a constraint on the growth of MSEs, and a restraint on the mobilization of domestic capital. The project will extend and build on the experiences and lessons learned from ADB's Microfinance and Employment Project, which built a solid base for microfinance and developed microfinance as a suitable tool for rural development in PNG. |
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| Impact | Economic growth led by the private sector is enhanced | ||||||||||||||
| Project Outcome | |
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| Description of Outcome | PFIs sustainably and safely provide financial services to a substantially increased number of clients across PNG |
| Progress Toward Outcome | There has been an increase of 260,000 deposit accounts with participating financial institutions (PFIs) during the project. On average, PFI portfolio at risk, financial self-sufficiency, and regulatory compliance has improved. |
| Implementation Progress | |
| Description of Project Outputs | Business and product management capacity of participating financial institutions is increased Clients and potential clients understand and know how to access, financial services for personal or business use The Association of MFIs monitors jointly agreed microfinance industry standards BPNG regulation and supervision of MFIs and SLS is streamlined and improved A risk-share facility supports increased micro and small enterprise lending The PMU provides efficient and effective project management services |
| Status of Implementation Progress (Outputs, Activities, and Issues) | The project has provided capacity building support to PFIs through staff training, on-site mentoring, and workshops. The project has also provided support to develop new financial products. All partners are producing quarterly portfolio performance indicators. Financial literacy training has reached over 200,000 clients/potential clients, improving their understanding of how to access and use financial services. Gender targets have been met. Industry standards are agreed, and reported on quarterly. The project has provided direct support to BPNG's regulation and supervision department. The risk-share facility has covered a total of 1,960 loans, with a cumulative value of PGK 27.2 million. The PMU provides quarterly project reports and maintains all project accounts. |
| Geographical Location | Nation-wide |
| Safeguard Categories | |
|---|---|
| Environment | FI |
| Involuntary Resettlement | C |
| Indigenous Peoples | B |
| Summary of Environmental and Social Aspects | |
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| Environmental Aspects | |
| Involuntary Resettlement | |
| Indigenous Peoples | |
| Stakeholder Communication, Participation, and Consultation | |
| During Project Design | |
| During Project Implementation | The project partners with commercial banks, microbanks, NGOs, faith-based organizations and cooperatives to reach very remote parts of the country to facilitate financial education and link clients to the formal banking sector. |
| Business Opportunities | |
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| Consulting Services | The lead implementation firm has been engaged. Various, smaller consulting packages for financial literacy and business development skills training, and others will be through QCBS/CQS/SSS/ICS method as suitable. |
| Procurement | All procurement of goods will be undertaken in accordance with ADB's Procurement Guidelines. Before the start of any procurement, ADB and the government will review the public procurement laws of the government to ensure consistency with ADB's Procurement Guidelines. The PMU will be responsible for the procurement of all goods and related services, under the project. Shopping will be used for procuring readily available off-the-shelf goods and related services valued up to $300,000. |
| Responsible ADB Officer | Hodge, Matthew W. |
| Responsible ADB Department | Pacific Department |
| Responsible ADB Division | Pacific Liaison and Coordination Office in Sydney, Australia |
| Executing Agencies |
Bank of Papua New Guinea Douglas St., P. O. Box 121 Port Moresby Papua New Guinea |
| Timetable | |
|---|---|
| Concept Clearance | 05 Mar 2010 |
| Fact Finding | 25 May 2010 to 28 May 2010 |
| MRM | 19 Aug 2009 |
| Approval | 28 Oct 2010 |
| Last Review Mission | - |
| PDS Creation Date | 05 Nov 2010 |
| Last PDS Update | 29 Mar 2019 |
Grant 0226-PNG
| Milestones | |||||
|---|---|---|---|---|---|
| Approval | Signing Date | Effectivity Date | Closing | ||
| Original | Revised | Actual | |||
| 28 Oct 2010 | 25 Nov 2010 | 07 Mar 2011 | 30 Jun 2018 | 30 Jun 2019 | 30 Jun 2020 |
| Financing Plan | Grant Utilization | ||||
|---|---|---|---|---|---|
| Total (Amount in US$ million) | Date | ADB | Others | Net Percentage | |
| Project Cost | 11.05 | Cumulative Contract Awards | |||
| ADB | 0.00 | 17 Jun 2022 | 0.00 | 5.73 | 95% |
| Counterpart | 5.05 | Cumulative Disbursements | |||
| Cofinancing | 6.00 | 17 Jun 2022 | 0.00 | 5.73 | 95% |
| Status of Covenants | ||||||
|---|---|---|---|---|---|---|
| Category | Sector | Safeguards | Social | Financial | Economic | Others |
| Rating | - | Satisfactory | Satisfactory | Satisfactory | - | Satisfactory |
Grant 0425-PNG
| Milestones | |||||
|---|---|---|---|---|---|
| Approval | Signing Date | Effectivity Date | Closing | ||
| Original | Revised | Actual | |||
| 09 Feb 2015 | 10 Jul 2015 | 10 Nov 2015 | 30 Jun 2018 | 30 Jun 2019 | 30 Jun 2020 |
| Financing Plan | Grant Utilization | ||||
|---|---|---|---|---|---|
| Total (Amount in US$ million) | Date | ADB | Others | Net Percentage | |
| Project Cost | 3.09 | Cumulative Contract Awards | |||
| ADB | 0.00 | 17 Jun 2022 | 0.00 | 2.13 | 69% |
| Counterpart | 0.00 | Cumulative Disbursements | |||
| Cofinancing | 3.09 | 17 Jun 2022 | 0.00 | 2.13 | 69% |
| Status of Covenants | ||||||
|---|---|---|---|---|---|---|
| Category | Sector | Safeguards | Social | Financial | Economic | Others |
| Rating | - | Satisfactory | Partly satisfactory | Satisfactory | - | Partly satisfactory |
Loan 2686-PNG
| Milestones | |||||
|---|---|---|---|---|---|
| Approval | Signing Date | Effectivity Date | Closing | ||
| Original | Revised | Actual | |||
| 28 Oct 2010 | 25 Nov 2010 | 07 Mar 2011 | 30 Jun 2018 | 30 Jun 2019 | 30 Jun 2020 |
| Financing Plan | Loan Utilization | ||||
|---|---|---|---|---|---|
| Total (Amount in US$ million) | Date | ADB | Others | Net Percentage | |
| Project Cost | 13.00 | Cumulative Contract Awards | |||
| ADB | 13.00 | 17 Jun 2022 | 11.67 | 0.00 | 100% |
| Counterpart | 0.00 | Cumulative Disbursements | |||
| Cofinancing | 0.00 | 17 Jun 2022 | 11.67 | 0.00 | 100% |
| Status of Covenants | ||||||
|---|---|---|---|---|---|---|
| Category | Sector | Safeguards | Social | Financial | Economic | Others |
| Rating | - | Satisfactory | Satisfactory | Satisfactory | - | Satisfactory |
Project Data Sheets (PDS) contain summary information on the project or program. Because the PDS is a work in progress, some information may not be included in its initial version but will be added as it becomes available. Information about proposed projects is tentative and indicative.
The Access to Information Policy (AIP) recognizes that transparency and accountability are essential to development effectiveness. It establishes the disclosure requirements for documents and information ADB produces or requires to be produced.
The Accountability Mechanism provides a forum where people adversely affected by ADB-assisted projects can voice and seek solutions to their problems and report alleged noncompliance of ADB's operational policies and procedures.
In preparing any country program or strategy, financing any project, or by making any designation of, or reference to, a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area.
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.
None currently available.
Evaluation Documents See also: Independent Evaluation
| Title | Document Type | Document Date |
|---|---|---|
| Papua New Guinea: Microfinance Expansion Project | Validations of Project Completion Reports | Oct 2022 |
Related Publications
| Title | Document Type | Document Date |
|---|---|---|
| Papua New Guinea: Microfinance Expansion Project | Brochures and Flyers | Apr 2016 |
The Access to Information Policy (AIP) establishes the disclosure requirements for documents and information ADB produces or requires to be produced in its operations to facilitate stakeholder participation in ADB's decision-making. For more information, refer to the Safeguard Policy Statement, Operations Manual F1, and Operations Manual L3.
Requests for information may also be directed to the InfoUnit.
3,200 People Graduate from Financial Literacy Course Supported by ADB, Australia, and PNG
More than 3,200 people graduated today from a financial education training program conducted under the Microfinance Expansion Project, a project supported by ADB and the governments of Australia and Papua New Guinea.
Banking the Unbanked Rural Women of Papua New Guinea
Rural women in Papua New Guinea are gaining financial independence with help from ADB's Microfinance Expansion Project.
Papua New Guinea's Drive For Long-Term Economic Growth
Papua New Guinea needs a diverse economy and an enabling business environment to support long-term growth. ADB investments in the country supports private sector activities and economic productivity.Partners Launch Gender Equity and Social Inclusion Policy for Microfinance Institutions in PNG
ADB, the Governments of Australia and Papua New Guinea, and the Center for Excellence in Financial Inclusion today officially launched a Gender Equity and Social Inclusion Policy for Microfinance Institutions.Microfinance Expansion Project in PNG Receives Additional Funding
The Government of Australia has provided AU$316,500 ($237,375) in additional financing to the ongoing Microfinance Expansion Project, designed to increase access to financial services for the people of Papua New Guinea.More Than 2,000 Complete Financial Literacy Course in Port Moresby
More than 2,000 residents of Port Moresby have celebrated the completion of a financial literacy course, bringing the total number of course graduates to more than 135,000 in Papua New Guinea.More Than 3,000 Madang Villagers Complete Financial Literacy Course
More than 3,000 residents of Madang Province celebrated the completion of a financial literacy course today, bringing the total number of course graduates to almost 100,000.Graduates Complete ADB, Australia-Supported Financial Training
More than 2,000 villagers from East New Britain, West New Britain and New Ireland provinces celebrated the completion of their financial education training at a graduation ceremony today at Rabaul (Vunapope) Catholic Hall.7,000 Highlanders Graduate from ADB, Australia-Assisted Financial Course
Thousands of residents from Baiyer District in the Western Highlands and Yangoose Village in Tsak Valley in Enga Province took part in a graduation ceremony today for a financial literacy course supported by ADB.Banking Services Put Women in Business in Papua New Guinea
In Papua New Guinea, a microfinance project delivering banking services to the poor supports the financial and social empowerment of women.Teaching the ABCs of Personal Finance in Papua New Guinea’s Tsak Valley
Sally Shute-Trembath from ADB's Pacific Liaison and Coordination Office reports from Tsak Valley in Papua New Guinea where hundreds of villagers recently graduated in style from financial education training.
Tenders
| Tender Title | Type | Status | Posting Date | Deadline |
|---|---|---|---|---|
| Financial Inclusion Data Specialist | Individual - Consulting | Closed | ||
| Accounting Specialist for Women's Microbank | Individual - Consulting | Closed | ||
| Team LeadeR/Project Manager | Individual - Consulting | Closed | ||
| Microfinance Project Cooridnator | Individual - Consulting | Closed | ||
| Regulation Specialist | Individual - Consulting | Closed | ||
| Finance Specialist | Individual - Consulting | Closed | ||
| Financial Inclusion Data Mapping | Firm - Consulting | Closed |
Contracts Awarded
| Contract Title | Approval Number | Contract Date | Contractor | Address | Executing Agency | Total Contract Amount (US$) | Contract Amount Financed by ADB (US$) |
|---|---|---|---|---|---|---|
| CEFI DIRECTOR | Loan 2686 | 10 Apr 2019 | SALIYA RANASINGHE | 82/32 F WICRAMASINGHEPURA SRI LANKA SRI LANKA | Bank of Papua New Guinea | 201,800.00 | 201,800.00 |
| PFI TRAINING | Grant 0226 | 13 Sep 2018 | INSTITUE OF BANKING & BUSINESS MANAGEMENT INC | PORT MORESBY PAPUA NEW GUINEA | Bank of Papua New Guinea | 184,464.00 | — |
| FINANCIAL EDUCATION | Grant 0226 | 20 Jul 2017 | K1 ASSOCIATION INC | SECTION 34 LOT 12 WARAKUM MOUNT HAGEN WESTERN HIGHLANDS PAPUA NEW GUINEA | Bank of Papua New Guinea | 798,935.00 | — |
Procurement Plan
| Title | Document Type | Document Date |
|---|---|---|
| Microfinance Expansion Project: Procurement Plan | Procurement Plans | May 2019 |