May 20, 2013
Islamabad, 15 April 2013 - Khushhalibank participated in the 3rd Islamabad Expo 2013 organized by Islamabad Women Chamber of Commerce and Industry, showing their untiring support and commitment to budding women entrepreneurs in Pakistan. Karachi, 25 March 2013 - Khushhalibank took a positive step towards the support and uplift of the industrious yet underprivileged strata of Pakistani population through the launch of Sehat Khushhali, Sehat Khushhali is Khushhalibank's first health insurance product for high quality in-patient treatment for its clients, free of cost. Islamabad, 21 March 2013 - Khushhalibank signed a 3-year Microsoft Enterprise Agreement with Microsoft Pakistan and InfoTech (Pvt.) Ltd, Microsoft’s Direct Large Account Reseller in Pakistan. Karachi, 4 March 2013- Malala Yousafzai, the world's youngest nominee for the Nobel Peace Prize from Pakistan, was honored with LADIESFUND® Khushhalibank Idol Award at the 5th Ladiesfund Awards 2013 ceremony held at Mohatta Palace Islamabad, February 27, 2013: Khushhalibank Limited, the first licensed microfinance bank in Pakistan expanded its network by opening six new branches in the Punjab region during the month of February 2013. These branches were opened in Minchanabad, Chiniot, Muzaffargarh, Fort Abbas, Alipur and Sadiqabad. September 15, 2012, Khushhalibank, joined hands with Dawood Global Foundation (DGF), Dawood Capital Management Limited (DCM) and Higher Education Commission (HEC) to promote women entrepreneurship by sponsoring the third LADIESFUND Entrepreneurship Conference, themed Cutting Edge Entrepreneurship (LEC 2012) n Karachi. August 10, 2012, Khushhalibank announced that it is extending its partnership with ShoreBank International Ltd (SBI), to develop and roll-out Khushhalibank branchless banking services in partnership with a national payment platform provider. June, 20, 2012, Khushhalibank sponsored a Sports Festival in Bhojowal village, Mandi Bahauddin. The festival consisted of an exclusive Kabaddi match, which was played between two local teams. May 31, 2012, SME Business Support Fund (BSF) and Ministry of Finance, Government of Pakistan arranged a SME FINANCIAL EXPO 2012 in Lahore.Khushhalibank also participated in the Expo by setting up a stall to provide information to the participants about microfinance in general and its products and services in particular. Ghalib Nishtar, President Khushhalibank who was the Guest of Honor at the Expo. 14 May 2012: Khushhalibank launches its 100th Online branch at Pattoki. Online/ real-time banking allows clients to access their funds and make transactions from any of the real-time branch offices of the bank. Islamabad, 5 March 2012, Pakistan and Afghanistan are committed to strengthen Microfinance Sector. It was agreed at the meeting between Ghalib Nishtar, President, Khushhalibank and visiting officials from Afghanistan that both Pakistan and Afghanistan, being neighboring developing countries in the Asian region, can benefit by developing and promoting the financial Infrastructure to support microfinance through continuous knowledge and skill sharing experiences of their respective markets. Karachi, February 2012, Khushhalibank and IBA Entrepreneurship Society Announce Winners of the ISERVE 2012 - a unique social enterprise competition aimed at providing students a platform to contribute significantly towards the community in the form of sustainable social ideas and creating a new generation of viable social ventures. Peshawar, 23 February 2012, Khushhalibank and Beacon-house join hands for ‘Model United Nations 2012’ (MUN). MUN is an academic simulation of the United Nations that aims to educate participants about current affairs, international relations, diplomacy and the United Nations agenda. The Frontier Campus Beacon-house Model United Nation (FC-BMUN) is the first ever MUN conference to be held in Peshawar. Islamabad, February 1, 2012, Khushhalibank and NUST join hands to host All Pakistan Model United Nations Conference 2012. September 21-22, 2011, Khushhalibank sponsors the World Islamic Finance Summit 2011. September 20, 2011, Khushhalibank partners with the National University of Sciences and Technology (NUST) as platinum sponsor in a nationwide business plan competition, titled 'Discover – Prosperity through Entrepreneurship'. September 16, 2011, Khushhalibank joins hands with Dawood Global Foundation (DGF) to promote women entrepreneurship by sponsoring the second LADIESFUND Entrepreneurship Conference (LEC 2011). August 01, 2011, The first Center for Entrepreneurship and Leadership (CEL) by SME Business Support Fund (BSF) was inaugurated at SZABIST Islamabad by Ghalib Nishtar, President Khushhalibank. May 25, 2011, The Microcredit Summit Campaign (MSC) status report ranks Khushhalibank as one of the biggest microfinance entities of the region having served two and a half million relationships and having over four hundred thousand active clients. May 05, 2011 , Khushhalibank and Western Union signed an agreement to introduce international inbound remittance services in 76 districts across Pakistan where Khushhalibank operates. This agreement makes KBL the first microfinance institution in Pakistan to introduce the cross border inbound remittance service, thereby facilitating a large segment of rural population to receive money from overseas through Khushhalibank's wide network of 109 branches. May 03, 2011 , JCR-VIS Credit Rating Company Limited (JCR-VIS) has upgraded the entity ratings of Khushhalibank, to 'A' (Single A) from 'A-' (Single A Minus) for the medium to long-term and A-1 (A One) from A-2 (A Two) for the short-term. The ratings reflect Khushhalibank's ability to withstand tough operating environment and maintain its market standing. It also highlights the bank's position as one of the largest microfinance bank operating in the MFB sector in Pakistan. February 26, 2011, Khushhalibank, while acknowledging the contributions made by young entrepreneurs in various sectors became the exclusive partner of IBA Verve 2011 organized by IBA Entrepreneurship Society (IBAES) and Center for Entrepreneurial Development. The event took place in Karachi and was graced by the some of the country's most renowned businesspersons. IBA VERVE 2011 was a unique platform in which students were exposed to real life success stories and industry best practices. February 22, 2011, Khushhalibank's clients won the highest numbers of awards during the 7th Citi-PPAF Awards held in Islamabad. Sajan, a client of Mithi Branch, was awarded a prize of Rs. 110,000 for being the Regional Winner from Sindh. His loan officer Jhaman Das received a cash prize of Rs. 25,000. In runners up category, Kalsoom Bibi from Rawalpindi Branch and Muhammad Azeem from Gawadar Branch were awarded a cash prize of Rs. 80,000 each and their loan officers Adeel Shaehzad and Khadim Hussain were given a cash prize of Rs. 20,000 respectively. August 11, 2010, Khushhalibank successfully completes 10 years of micro-finance banking in Pakistan. Ghalib Nishtar, President Khushhalibank, expressing his views on the occasion said, "Today, we have made our contribution by making a difference in hundreds and thousands of lives across the country by providing financial service access to the unbanked segments of the population." April 19, 2010, Khushhalibank held its Annual Sales Conference at PC Bhurban to review the performance for the year 2009. The conference was chaired by Ghalib Nishtar, President, Khushhalibank and attended by all Departmental Heads and the Retail Unit from the Corporate Office, and Regional Business Managers and Territory Portfolio Managers from their respective Regions. February 16, 2010, Khushhali Bank in collaboration with American Business Council has given the first 20 cheques to the affected traders of Bolton Market under 'Bolton Market - Business Revitalization Program' of USAID in a ceremony held in Karachi. Khushhali Bank is managing the process of grant disbursement of USAID's funds of PKR 1 billion for the program. August 11, 2009, Khushhali Bank celebrates its ninth anniversary to acknowledge the contribution and hard work of its employees, while resolving to make its clients a priority and rejoicing the unprecedented success of past nine years. Khushhali Bank Limited re-constitutes its Board of Directors for a term of three years. Syed Ali Raza, President, National Bank of Pakistan, being the chairman, the new Board of Directors consists of seven members, four representing the share holders three non share holding Independent Directors.
What is Microfinance
Articles on Microfinance
MFIs Ordinance 2001
What is Microfinance
Microfinance is â€śbanking for the poor,â€ť as it is an astoundingly simple approach that has been proven to empower poor people around the world to pull themselves out of poverty. Relying on their traditional skills and entrepreneurial instincts, very poor people, mostly women, use small loans (usually less than US$200), other financial services, and support from local organizations called microfinance institutions (MFIs) to start, establish, sustain, or expand very small, self-supporting businesses. A key to microfinance is the recycling of loan. As each loan is repaid, usually within six months to a year, the money is recycled as another loan, thus multiplying the value of each dollar in defeating global poverty, and changing lives and communities.
What do Local Microfinance Banks/Institutions (MFBs/MFIs) do?
These front line organizations reach out to the very poor and deliver microfinance services to local clients on a daily basis. They educate local communities about the opportunity to improve their lives with microfinance; make micro loans and provide other financial services such as micro credit, savings accounts and microinsurance; collect loan payments; and assist clients in solving life challenges that they may face. Many also provide social services, such as basic health care for clients and their children.
MFIs differ in size and reach: some serve a few thousand clients in their immediate area, while others serve hundreds of thousands of poor people through a network of branches covering large regions. Khushhali Bank Limited founded in 2000, is Pakistanâ€™s largest and most successful MFB. Khushhali Bank Limited has also made its mark in the international arena and is watched closely to be considered as a progressive model. Khushhali Bank Limited has served more than 1.5 million loans to date.
Where do MFBs/MFIs get the money for loans?
Funding comes from individuals, philanthropists, foundations, government and international institutions such as ADB, World Bank etc.. MFBs/MFIs also borrow funds from traditional banks to provide loan to their clients. In addition, the interest paid by clients on microfinance loans goes back into the program to cover costs and to fund more loans.
One of the most attractive features of microfinance is the goal of self-sufficiency for both microentrepreneurs and MFIs. Khushhali Bank Limited is spearheading several initiatives to give MFIs access to the private market financing options available to traditional banks. By combining access to private market financing with more efficient management and technology, MFBs/MFIs can begin to move from reliance on philanthropy to self-sufficiency. Khushhali Bank Limited has proven that this can be ably accomplished.
Why is this different from other loan programs?
Unlike other loan programs, clients are not required to provide collateral to receive loans. This allows people who would not qualify for loans at traditional financial institutions to receive credit. MFBs/MFIs are also very client-friendly; most of them usually go to their clients to provide loans and receive payments, rather than requiring their clients to come to them. A few of them also use focal centers where clients gather to conduct financial transactions and receive other social services. The peer support system practiced by many microfinance programs is another unique feature. When clients gather monthly at â€ścenter meetingsâ€ť to make loan payments, or informally in smaller support groups, they share successes and discuss ideas for solving business and personal problems. Perhaps significantly, they empower each other to stay on the path out of poverty. This mutual support strengthens their resolve.
In addition, MFB/MFI staff members share vital information and resources to improve their clientsâ€™ well being. This might include bringing in local trainers which provide them training or setting up small infrastructure projects for the well-being of the communities, offering scholarships to students from non-bankable territories, etc.
Are these people really poor?
Khushhali Bank Limited serves very poor people â€“ many of whom are in rural areas and live on only a dollar or so a day. While the exact dollar figures for measuring their level of poverty may vary from country to country, one thing is constant: they are literally struggling to live on a day to day basis. We aim to target the grassroots levels and at the same time support those individuals who have come out of the grassroots ranks and are ambitious to attain a higher level. Development is gradual, therefore we intend to bring improvement in living conditions and motivate them to take on challenges, and work with commitment to improve their lives and destinies.
What is the difference between Microcredit and Microfinance?
Microcredit refers specifically to loans and the credit needs of clients, while microfinance covers a broader range of financial services that create a wider range of opportunities for success. Examples of these additional financial services include savings, insurance, housing loans and remittance transfers. The local MFB/MFI might also offer microfinance plus activities such as entrepreneurial and life skills training, advice on topics such as health and nutrition, sanitation, improving living conditions, and the importance of educating children.
Why do MFBs/MFIs focus on women?
Women have proven to be the best poverty fighters. Experience and studies have shown that they use the profits from their businesses to send their children to school, improve their familiesâ€™ living conditions and nutrition, and expand their respective businesses.
Can very poor people actually start and run a successful business?
Indeed this is possible as many poor people have skills that can quickly turn into an income-producing activity. With small sums of money, they are able to purchase the inventory, supplies and tools needed to start or expand microbusinesses that range from weaving, sewing, grinding grain, reselling produce, growing and selling vegetables and cash crops, to catching and selling fishing, raising chickens to sell eggs, and breeding livestock, retail outlets, making bangles, handicrafts etc.
These small ventures can grow into vibrant community businesses. One microentrepreneur from Sindh involved in handicrafts, bought extra tools to increase the production of handicrafts and sold them to local urban markets. The demand grew quickly and he hired her neighbors and some young uneducated youth to help. Now, nearly 20 people earn an income from her family business of manufacturing handicrafts, and thus her entire community is benefiting from the same.
Do very poor people repay their loans?
Yes, microfinance clients are excellent credit risks. The repayment rate is between 95 and 98 percent. In fact, it is higher than the repayment rate of student loans and credit card debts in the United States. They value the opportunity to improve their lives.
Do people really get out of poverty?
Microfinance is not a silver bullet. It will not defeat global poverty by itself. But, it is an important part of the solution. Microfinance provides a stable and sustainable source of income that enables clients to climb steadily out of poverty, while providing better living conditions and opportunities for their families. For some, this progress means moving from a house made of mud to one of bricks and cement. For others, it means better nutrition and the money to finally send their children to school.
Iâ€™ve heard that MFBs/MFIs charge a high rate of interest for the loans. Is that so?
Like other financial institutions, microfinance banks and institutions (MFBs/MFIs) charge interest for the loans they make for their clients. The interest covers the high cost of making very small loans and personal servicing towards each client. It also covers the cost of managing the â€ścenter meetingsâ€ť; the peer support group process; and providing information on social services, personal development, health and other critical information that helps clients improve their lives and the future of their families. Their rates are also largely influenced by the rates MFBs/MFIs themselves pay for borrowing the funds that they in turn lend to their clients. Without microfinance programs, the most common alternative for very poor people are the local â€śmoney lenders,â€ť who regularly charge between 120 and 300 percent.
Aren't the poor too poor to save?
The poor already save in ways that we may not consider as "normal" savings--- investing in assets, for example, that can be easily exchanged to cash in the future (gold jewelry, domestic animals, building materials, etc.). After all, they face the same series of sudden demands for cash we all face: illness, school fees, need to expand the dwelling, burial, weddings.
These informal ways that people save are not without their problems. It is hard to cut off one leg of a goat that represents a family's savings mechanism when the sudden need for a small amount of cash arises. Or, if a poor woman has loaned her "saved" funds to a family member in order to keep them safe from theft (since the alternative would be to keep the funds stored under her mattress), these may not be readily available when the woman needs them. The poor need savings that are both
They care less about the interest rates that they can earn on the savings, since they are not used to saving in financial instruments and they place such a high premium on having savings readily available to meet emergency needs and accumulate assets.
These savings services must be adapted to meet the poorâ€™s particular demand and their cash flow cycle. Most often, the poor not only have low income, but also irregular income flows. Thus, to maximize the savings propensity of the poor, institutions must provide flexible opportunities--- both in terms of amounts deposited and the frequency of pay ins and pay outs. This represents an important challenge for the microfinance industry that has not yet made a concerted attempt to profitably capture tiny deposits.
Are Commercial Banks involved in Microfinance?
Yes the commercial banks are involved within microfinance in an increasing way. Formal financial institutions are recognizing the benefits of serving poorer clients.
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