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Can Tho, Vietnam, February 2, 2018—
IFC, a member of the World Bank Group, is helping microfinance institutions in Vietnam improve their corporate governance practices. Studies have shown that stronger governance enhances performance and risk management, which is expected to strengthen the microfinance institutions’ ability to cater for the financial needs of microenterprises and low-income people.
Dozens of board members and senior executives of Vietnamese microfinance institutions gather in Can Tho for a two-day workshop to address common governance challenges they face. Globally, regulators and investors have been supporting company efforts to demonstrate better governance, such as having a robust board, accountable senior management, and effective internal control and risk management practices.
“IFC believes supporting Vietnamese microfinance institutions in strengthening their corporate governance practices will boost their capacity to provide better financial services and expand lending,” said Kyle Kelhofer, IFC Country Manager for Vietnam, Cambodia, and Lao People’s Democratic Republic. “This will ensure sustainable growth for the institutions and benefit their key clients – millions of micro-entrepreneurs, primarily women, and low-income households, contributing to poverty reduction in the country.”
In Vietnam, only one in five adults have access to formal financial services and only 8 percent of them have savings in formal institutions. Microfinance lenders play a critical role in providing financial services to the low-income population, serving an estimated 10 million people, many of whom are women and the poor, according to IFC studies.
The workshop, which ends today, helps participants examine their institutions’ key governance functions such as the board, compliance, and internal audit, and develop an action plan for improvements. The workshop is conducted by IFC, in partnership with Citi Foundation and the Vietnam Microfinance Working Group, a leading industry forum for microfinance practitioners to share knowledge and strengthen the sector’s voice in policymaking. More than 30 of its members are microfinance institutions offering financial services.
“Vietnam’s microfinance sector is evolving with many small, non-profit operators hoping to transition into bigger, commercial-oriented entities,” said Nguyen Thi Tuyet Mai, Managing Director of the Vietnam Microfinance Working Group. “Implementing corporate governance reforms to enhance efficiency, transparency, and risk management will be paramount to their successful transitions.”
This initiative is part of IFC’s Vietnam Microfinance Program – supported by the State Secretariat for Economic Affairs of Switzerland – with the aim of strengthening industry capacity and transparency as well as boosting microfinance institutions’ ability to increase sustainable and responsible financial access.
About IFC
IFC—a sister organization of the World Bank and member of the World Bank Group—is the largest global development institution focused on the private sector in emerging markets. We work with more than 2,000 businesses worldwide, using our capital, expertise, and influence to create markets and opportunities in the toughest areas of the world. In FY17, we delivered a record $19.3 billion in long-term financing for developing countries, leveraging the power of the private sector to help end poverty and boost shared prosperity. For more information, visit
www.ifc.org
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About Vietnam Microfinance Working Group
The Vietnam Microfinance Working Group (VMFWG) was founded to create a forum for microfinance practitioners to share experiences and together address relevant issues of the industry, raising a unified voice to policymakers. Established in 2004 as an informal nongovernmental organization under the VUFO-NGO Resource Center, VMFWG is open to all individuals and organizations interested in microfinance in Vietnam. For more information, visit
www.microfinance.vn
About Citi Foundation
Citi Foundation focuses on three main aspects: financial education, youth education, and community and entrepreneur support. Citi is one of the world’s biggest sponsors of the microfinance industry, contributing US$40 million to support programs and microfinance institutions in more than 50 countries. In 1997, Citi committed over US$13 million to fund microfinance programs in Asia alone. For more information, visit
www.citifoundation.com
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