Micro-financing bolstered

THE micro-financing level at the rural communities in the country will get a big boost through a loan from the Asian Development Bank with the support of the Australian government for the microfinance expansion project (MEP).
ADB will extend a loan of US$24 million (K63 million) to the project to help rural communities in Papua New Guinea access credit and financial services.
On the other hand, the Australian government thorough AusAID would provide A$6 million (K15 million) while the national government and the beneficiaries would cover the remaining A$3.09 million.
ADB believed that lack of access to finance was a major constraint to rural development in the country and estimated that only 15% of the population had access to formal or informal banking facilities.
It also noted that many parts of the country still use a non-monetary barter system for trading.
The ADB and Australia-supported MEP is expected to help boost growth and generate jobs in some of the country’s poorest and most isolated regions.
To effect the project planning and implementation, ADB country director Charles Andrews, Bank of PNG governor Loi Bakani, Treasury secretary Simon Tosali and Tony Westaway and Mohan Visnu who are directors of the PNG Institute of Banking and Business Management signed the loan and grant agreement.
The signing was witnessed by Catherine Gill, counsellor governance from AusAID.
Tosali said the project would make much relevance to the government’s developments priorities and fits well with the medium term development plan and the nation’s 2050 Vision.