Bank of Sudan - Microfinance Unit

Sudan Microfinance Development Facility

TERMS OF REFERENCE

to hire a reputable firm to establish the Sudan Microfinance Development Facility (SMDF)

Background

The Bank of Sudan recently commissioned a study of the microfinance sector with the objective of preparing a long term development strategy for the sector. The resulting strategy includes a five year action plan that aims at enhancing the sectors contribution to economic and financial sector development as well as reducing poverty in the country. The strategy also aims to take proactive steps to support women entrepreneurs who lack support when compared to their male counterparts.

In 2006, the study concluded that microfinance, as it is known and practiced worldwide, is at an infancy stage in Sudan with supply being extremely small compared to demand for these services. Rough estimates have put the demand covered at only about 1-3%. A microfinance sector, offering financial services such as micro loans, repeated and larger loans, consumption loans, savings, deposits, money transfers, insurance and adopting acknowledged performance measurement indicators, does not really exist in Sudan. Despite the several experiments in micro lending launched to extend 'small' loans to small producers and low-income groups, including women, yet there is no conformity in approach among the institutions/agencies undertaking these endeavors. This is probably a result of dissimilar objectives in terms of poverty alleviation and the absence of a clear strategy for microfinance.

A growing focus on poverty alleviation has developed during the last few years, as reflected by the establishment of several social funds; specialized institutions such as the Savings and Social Development Bank (SSDB) and the Social Development Fund (SDF); and the launching of several, albeit, scattered poverty alleviation initiatives. Nevertheless, the government's efforts in developing microfinance policies that tackle poverty in a most efficient manner remain limited and uncoordinated. NGOs and rural development projects have continued to be the main providers of microfinance to the poor, but these initiatives have remained limited in coverage and impact when compared to the size of the problem of poverty in the country.

There is a huge potential for the development of microfinance programs in the country, particularly in light of current social and economic conditions, and the Government's declarations for prioritizing poverty alleviation in its policies. However, there are many challenging constraints facing this nascent microfinance sector which unless addressed will limit its effectiveness in fulfilling its role in poverty alleviation and economic development.

for more information please click here