Lanka should tap micro finance more

by L. S. A. Wedaarachchi

Globally, banks are realising the potential of Micro finance. Sri Lanka which can boast of a 90 per cent literacy rate and religious co-existence has the potential to take Micro finance forward.

The Sri Lanka Cooperative Rural Banks Federation Ltd., one of the leading village based Micro finance institutions collected Rs. 2.5 billion through its Ru Bank Plus Savings competition held last year. The target of that competition was Rs. 1 billion.

"The outcome of the 'Ru Bank Plus' competition disproves that Micro finance has not conferred benefits to people. Sri Lankans have a high regard for cooperative rural banks and for the Cooperative Movement, said S. A. Wickramapala, the chairman of the Sri Lanka Cooperative Rural Banks Federation Ltd. and Cooperative Leasing Co. Ltd.

The first prize winner of the Ru Bank Plus competition won a Maruti car and the second and third prize winners were awarded air tickets to Thailand and India. The members of 1,100 rural bank branches affiliated to 310 Multi-purpose Cooperative Societies participated in the Ru Bank Plus savings competition.

Explaining the Micro finance sector in Sri Lanka, the chairman of the Cooperative Rural Bank Federation said, that Micro finance institutions have to be promoted to eliminate poverty in Sri Lanka.

"The need of the hour is to ween the poor from a 'subsidy syndrome' which has been prevalent in the past few decades. The agriculture based rural population which constitutes 70 to 80 per cent of the population needs guidance and leadership to transform them to entreprenurship, he said.

"Micro finance is sustainable. The question is how can we fit them into the current environment. We live in a high tech age, the benefits of which are usually enjoyed only by the affluent. Our duty is to make the same resources available to rural areas, he said.

According to Vinitha Samaraweera, Secretary-Manager of the Rural Banks Federation, the Bank plans to implement a well-planned development program in the near future to educate the rural population in financing activities. The village based agricultural industrial and fishing sector developmental micro projects will also be introduced to the rural sector.

"It is essential to join the national effort for development and self-reliance. Our own resources including human resources have not been exploited properly and we still look for assistance from outside.

As a mass movement the Cooperative sector in Sri Lanka during its past one hundred years achieved remarkable progress. The Rubank sector itself motivated people in rural areas to promote the savings habit and rural bank savings exceed Rs. 24 billion to date, she said.

The Sri Lanka Cooperative Rural Banks Federation Ltd commenced operations 42 years ago as a cooperative rural bank registered with the Central Bank and the Cooperative Department. The bank has financed Micro and self-employment projects all over the island during the last four decades. The projects embraced the agriculture, industry and fishing sectors.

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