Terms of Reference

REGIONAL TRAINING ON

MICRO CREDIT SCHEME

Venue: Jakarta, Indonesia, August 27-31, 2002

BACKGROUND

            Based on the recommendations of the expert group meeting on “Identification of Major Issues in Eradicating Poverty and Fostering Rapid and Equitable Development” in NAM member countries, convened by NAM CSSTC in April 2001, the Centre decided to follow-up with providing a forum for micro credit institutions and practitioners to discuss and make recommendations regarding their roles in promoting and mobilizing micro credit schemes in NAM member countries. It is widely believed that  a properly designed and implemented micro credit schemes is central to alleviate poverty by providing support for lower-income groups to increase their income.

As a follow-up of the expert group meeting NAM CSSTC invited policy makers and practitioners from different NAM member countries who are concerned with the micro credit services to a workshop held in Jakarta, in June 2002. They have deliberated on  the relevant aspects concerning key issues, technical aspects and policy, and also to make recommendations to enhance the sustainability of micro finance institution as well as people’s involvement in such particular financing scheme.

It is recommended that NAM CSSTC takes the initiatives to increase cooperation in the fields of comparative studies, training programme in micro credit services and technical assistance. NAM member countries should promote transparency in micro credit services by setting up standard performance, establishing rating agencies and promoting internal control. The meeting also identified specific actions and recommendations that could be taken by NAM CSSTC to promote and mobilize micro finance practices in NAM member countries and also to achieve sustainability in the programme.

Based on the recommendations of the workshop, NAM CSSTC plans to hold series of regional trainings on micro credit schemes. The first one to be conducted in Indonesia for East Asia and the Pacific region.

OBJECTIVES

The main objective of this training is to provide an instant benefit to the micro credit practitioners, especially those from East Asia and the Pacific region. Upon completion of this training  the trainee is expected  to be able to deliver significant contribution to the development and mobilization of micro credit practices in his/her country.

SUBSTANCE, METHODOLOGY AND EXPECTED OUTPUT

Substance

The training substance will be focused on the technical aspects of micro credit. Subjects to be delivered and discussed include areas such as Philosophy of Micro Credit, Micro Credit Schemes, Product Innovation, Credit Delivery System, Loan Analysis, Loan Monitoring and other related areas.

Methodology

Participatory approach will be applied during the in-class training session as well as in-field training session

Expected Output

Each trainee is expected to:

§      acquire a complete comprehension on technical aspects of micro credit schemes;

§      acquire necessary skills to mobilize micro credit practices in his/her country;

§      produce an action plan to be followed up upon his/her return to his/her organization.

PARTICIPANTS

The trainees should be practitioners, either of non-governmental organizations or banks dealing with micro credit services in the region of East Asia and the Pacific. They should be corresponding to the following requirements:

·         The person must be actively involved in community development project, preferably in a micro credit practice in his/her country,

·         The person must have a basic knowledge in financial analysis and credit delivery,

·         The person must be able to speak English.

DURATION

Duration of the training will be 5 (five) days, August 27 to 31, 2002.

VENUE

Training activities will be conducted in Jakarta, while in-field training session will be conducted in West Java.

ORGANIZING INSTITUTIONS

The meeting is organized by Non-Aligned Movement Centre for South-South Technical Cooperation (NAM CSSTC) in collaboration with Bank BRI, a state-owned bank which is one of the largest commercial banks in Indonesia conducting a full range of commercial banking services, domestic and international.

NAM CSSTC  was established in 1995 at the eleventh Summit of NAM held in Cartagena, as one of the vital and effective means for promoting and accelerating development in the developing countries. Its objective is to enhance the collective self-reliance of NAM member countries in attaining sustained people-centered economic and social development and to enable developing countries to become equal partners in international relations. However, the functions of NAM CSSTC are not just a forum for dialogue but a centre for action, pooling the resources to attain the objectives of both NAM member and non-member countries. The programmes should have immediate as well as long term impact to render the economies of developing countries to be more broad-based, efficient and resilient to participate in the globalization process and to strengthen cooperation among developing countries.

Bank BRI is the first state-owned bank to operate in Indonesia. It was founded in 1895 which original aim to serve as a deposit point for mosque cash holdings and give out low interest loans. In its development the bank has undergone several changes to its name in close relations with  the historical development of the nation, from Hulp-en Spaarbank der Inlandsche Bestuur Ambtenaren (1912) to Bank Rakyat Indonesia (BRI 1946). Bank BRI’s vision is to become a leading institution putting customer first. There are three missions have been placed in Bank BRI’s mind. One of them is to give the best banking service focusing on micro, small, retail and medium scale enterprises to enhance the economic activity of the society at large. In line with this, BRI signed a partnership agreement with the Consultative Group to Assist the Poorest of the World Bank (1999) to develop the international visitor program (BRI IVP). The institution conducts various study tour, in-class training, and on-the-job training programmes related to BRI microfinance practices, especially micro enterprises involving the working poor.

BRI IVP will coordinate the training sessions based on NAM CSSTC assessment and guidelines.

TRAINING AGENDA

TRAVEL AND ACCOMMODATION EXPENSES

NAM CSSTC will pay y-class international airline ticket for trainees from his/her country to Jakarta, accommodation and food expenses, as well as domestic transport during training. The sponsored participants comprise of one participant of each NAM member country in the region of East Asia and the Pacific.

VISA ARRANGEMENT

To enter Indonesia, generally trainees need to get the appropriate entry visa.  However, it is not applicable for those who come from ASEAN member countries. If there is no Indonesia Embassy or Mission there will be local arrangement for ‘visa on arrival.’ Local Committee will provide necessary assistance.