In the News Government Provides US $300,000 to Microfinance Sector through UNCDF and UNDP
Dili, Timor-Leste, 27 August 2009
Continuing its partnership with the United Nations Capital Development Fund (UNCDF) and the United Nations Development Programme (UNDP), the Government of Timor-Leste contributed US$ 300,000 to the UNCDF/UNDP programme on Inclusive Finance for the Under-Served Economy (INFUSE), a five-year initiative which aims at increasing access to sustainable financial services by the poor and the low-income population .
Speaking in a ceremony to mark the formalization and transfer of the funds, which took place in Dili on 27 August 2009, the Minister for Economy and Development Mr João Gonçalves said the contribution to INFUSE “will provide much needed support to the microfinance institutions to enable them to provide sustainable access to savings and credit for micro entrepreneurs and others in the rural areas.” Building an inclusive financial sector will “contribute to long-term economic development and poverty alleviation in the country,” the minister said, adding that two microfinance institutions have already been identified and evaluation of their capacity conducted. The support to the microfinance sector is a priority development issue and discussions with donor partners are ongoing, he said.
In his remarks, the Country Director of UNDP Timor-Leste, Akbar Usmani expressed gratitude to the Government and the Minister, saying INFUSE will further strengthen the partnership between the Government and development partners including UNCDF and UNDP. “The project will address needs of the rural population in accessing financial services and this will go a long way in alleviating poverty in those areas,” he said, noting that the contribution from the Government “reflects its commitment to eradicate poverty in rural areas.”
Stressing that INFUSE will support microfinance institutions by providing them with resources and technical assistance to enhance their capital base, the project’s Chief Technical Advisor, Mercella Willis said this move will enable the institutions to provide not only credit but a wide array of micro-finance services and expand their customer portfolio.
Launched in 2008, the US$ 5 million INFUSE project financed by UNCDF, UNDP and the Government of Timor-Leste, is a major boost to the fledging microfinance industry. Currently, experts say that the outreach of financial services providers remains limited, calling for a sector-wide approach for developing a robust, inclusive microfinance infrastructure in the country.
UNCDF contributes to the achievement of the Millennium Development Goals in Least Developed Countries through a variety of innovative approaches in both local development and microfinance. UNDP is the UN’s global development network, with a wealth of experience implementing development programmes in many developing countries.
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