Impact Banking Introduction

Project Name

Partner Organization

Description                                                  

Multi Stakeholder Forestry Programme (MSFP)

LI-BIRD

Multi Stakeholder Forestry Programme (MSFP) is funded by UKaid from the Department for International Development (DFID), the government of Finland and the Swiss Agency for Development and Cooperation (SDC) and supported by the government of Nepal. It aims to improve livelihoods and resilience of poor and disadvantaged people in Nepal. It will also develop the contribution of Nepal's forestry sector to inclusive economic growth, poverty reduction, and tackling climate change. One of the implementing partner of MSFP is LI-BIRD (Local Initiatives for Biodiversity, Research and Development). Along with LI-BIRD, District Chamber of Commerce and Industries (DCCI) of Myagdi, Baglung and Parbat and the MNBBL had partnered to establish Value Chain Development Fund (VCDF). Through VCDF, MNBBL play a critical role to provide access to finance to the forestry based entrepreneurs.

 Access Advisory, Regional Programme on Remittances and Diaspora Investment for Rural Development 

International Fund for Rural Development (IFAD)

The programme developed financial products and delivery systems to enable migrants and their family members to increase the amount they save from their remittances and channel their savings into investment in their (rural) communities of origin.

  Climate Smart Finance

Frankfurt School of Finance & Management and International Development Enterprise Nepal (iDE Nepal)

Supported by Development Bank of Austria (OeEB) and the Federal Ministry of Agriculture, Forestry, Environment and Water Management. Under this partnership the bank able to develop “Improving Agriculture Loan” product through market research. The Farmers were trained and provided required loan to run their Agro-farm.

Aarthapurna Jeewanka Lagee Aawas

Habitat For Humanity International

Habitat For Humanity International Campaign- Aarthapurna Jeewanka Lagee Aawas “Meaningful Life Through Housing”, created awareness among stakeholders and boosted up low cost housing loan product to serve low income people.

INNOVATE – Adoption of Agricultural Innovations through Non-Traditional Financial Services

Mennonite Economic Development Associates (MEDA) and International Development Enterprise Nepal (iDE Nepal)

INNOVATE – Adoption of Agricultural Innovations through Non-Traditional Financial Services was funded by the International Development Research Centre (IDRC). The project was able to serve 1,590 farmers by using indirect lending to the farmers. 

HEDERA

HEDERA Sustainable Solutions GmbH

HEDERA Sustainable Solutions GmbH is an organization based in Germany. MNBBL and HEDRA teamed to conduct research/ study using framework of IMPACT-R using questionnaires based on the following methodologies: the ESMAP Multi-tier Framework (MTF) for energy access assessment, WHO/UNICEF Joint Monitoring Program for WASH, and FAO Food Insecurity Experience Scale (FIES) for food security. 

Non- Traditional Financial Services Project (NTFS)

iDE Nepal

Over the las few years, Muktinath Bikas Bank Limited (MNBBL) developed a partnership with Ide Nepal. Mnbbl has a microfinance program which lends in agriculture sector too. It directly administrators loans through branch offices. Initially Ide, the Frankfurt School German, and MNBBL collaborated to design climate smart vegetable loan products based on smallholder needs and business plans. The loan models were piloted successfully; iDE provided technical support and supply chain development to about 600 households and facilitated loans of about $ 450,000. Over this period MNBBL has become familiar with iDE’s commercial pocket approach and is interested to pilot Non-Traditional Financial Services to lower costs of its agricultural loan products and to improve technical support increasing farmer returns.  Adoption of Agricultural Innovation through Non-Traditional Financial Services (NTFS) is a pilot project funded by International Development Research Center (IDRC) through Mennonite Economic Development Associates (MEDA) For 20 months ( January 2018- November 2019) in Kaski and Syangja district and Anukulan X Project funded by DFID for 15 months (April 2018- March 2019) in Kaski and Syangja district and Rudy and Aliace Ramsey Foundation for 15months ( January 2018- March 2019) in Palpa district.  International Development Enterprises (iDE) is leading the project in collaboration with Muktinath Bikas Bank.

Improving access to finance for Small and Micro Enterprises (SMEs) in the Construction Sector / UKAID supported Post –Earthquake Recovery  Project (Purnima)

Mott MacDonald Limited- Nepal Branch

MNBBL had signed a partnership agreement with Purnima project funded by DFID and implementd by Mott MacDonald in Nepal. The project was implementd by MNBBL in Dhading District with a focus to provide appropriate financial services to the MSMEs involved in construction sector in different parts of the district. For understanding the MSMEs financing requirements, MNBBL conducted a market research in Dhading district with technical support from ACCESS Advisory. Based on the findings of the market research MNBBL made some adjustments to its SME loans to cater to the needs of the construction sector MSMEs and then offered the modified product through its branches in the district. In addition to offering them with financial products the Bank also provided the MSMEs with financial and business literacy training programs.

The specific objectives of the project are:

To increase construction sector SMEs’ access to financial services such as savings, loans and insurance.

To acquire a client profiling and credit analysis software for efficient loan decision-making, monitoring and risk management.

To enhance the mindset, knowledge and skills of construction SME owners on financial discipline and business management.

To enhance MBBL’s general operations in Dhading districts.

To introduce digital technologies such as QR code for transaction.

Scientific Research and educational activities

The Human Rights Center of the University of Padova

The purpose of this Memorandum of Understanding  is the joint international co-operation through one or more of the following activities:

Scientific research and educational activities in subjects of common interest, in particular in human rights and local development in the framework of the UN 2030 Agenda for Sustainable Development

Mobility of MA Students and doctoral candidates for academic activities, through a procedure

Participation in seminars, academic meetings and other teaching programme.

Sustainable Economic Development in Rural and Semi-Urban Areas – MSME Finance Phase II(SEDRA II)

Government of Nepal represented by the Ministry of Finance (MoF, "Recipient") and Nepal Rastra Bank (NRB, Project-Executing Agency” and KfW Development Bank, German.

The Project concerns the refinancing of sustainable and target-group oriented sub-loans to micro, small and medium-sized enterprises (MSMEs) in rural and semi-urban areas in Nepal. This refers in particular to loan sizes in the so-called ‘missing middle’ (NPR 200,000 to 4,000,000) which go beyond microfinance but remain below traditional corporate finance. The Project supports two Partner Financial Institutions (PFIs) in expanding their rural and semi-urban MSME loan portfolio, of which Muktinath Bikas Bank Limited (MNBBL) has been selected as one of them. The purpose of the Project is the sustainable provision and use of a target-group oriented loan portfolio for predominantly rural and semi-urban MSMEs for their business investments. In light of the economic crisis caused by the COVID-19 pandemic, providing target-group oriented financing and liquidity to MSMEs has becomes even more important. The Project contributed to provide access to finance to MSMEs in the crisis and support the selected PFIs in crisis management. Overall, the Project contributes to improving the entrepreneurial ecosystem for sustainable and socially balanced economic development in Nepal.

Improving access to finance for Small and Micro Enterprises (SMEs) in the Construction Sector / UKAID supported Post –Earthquake Recovery  Project (Purnima)

Mott MacDonald Limited- Nepal Branch

Muktinath Bikas Bank and Mott Macdonald had entered into a partnership through memorandum of understanding for a period from 23rd January 2019 to 31st July 2019. During the period MNBBL had Modified Loan products features and simplified the process for the MSMEs. As a result, 37 MSMEs (against the target of 25) were able to receive loan from the bank for their business improvement during the piloting period. The Pilot project had been successfully implemented and after the successful collaboration Mott Macdonald is interested to take further partnership, Hence, MNBBL had signed agreement with MottMacdonald on dated 8th November 2019, for further lending to SME’s of Gorkha, Dhading and Nuwakot.

Avsar Microfinance Loan

Avsar Foundation, Kathmandu-25, Kathmandu

Financial Empowerment lies at the heart of empowering low-income communities. Illiteracy, low level of wealth, inheritance of debt compounded by inability to service debt borrowed at high interest rates from village landlords lead to vicious circle of poverty for such individuals and families. With an objective to address this prevalent issue in rural parts of Nepal. AF has introduced its program called “AVSAR Microfinance (Interest Return) Program”. Under the Program, AF collaborates with banks and other financial institutions as its implementation partner to design microfinance lending programs targeted towards low income deprived population.

MNBBL is focused towards working with the target people of AF and its vision is also very focused towards giving support to the under –privileged people and communities with low income in rural areas. This project will be implemented in following districts Taplejung, Dolakha, Siraha, Nawalparasi, Kapilvastu & Kailali.

The CSISA Nepal Covid-19 Response and Resilience Activity

iDE Nepal

MNBBL and iDE Nepal to implement Objective 1 of the CSISA Nepal Covid-19 Response and Resilience Activity (hereinafter referred as the “Project”). MNBBL will work with iDE as a financial partner to lend loans to returnee migrant workers for the purchase of farm mechanization machineries.  iDE and MNBBL will work in close collaboration to design and implement the loan financing and facilitate the returnee migrant workers to take up farm mechanization services as a successful enterprise.

Objective 1: This objective pertains to the expanded use of scale-appropriate farm machinery to generate employment, lower production costs for farmers, and create new entrepreneurship opportunities in the context of a COVID-19 affected Nepal. Key outcomes from this objective include development of 100 returnee migrant workers as  ‘service providers’ entrepreneurs, offering scale-appropriate land preparation, planting, irrigation, harvesting or post-harvest machinery services.

This activity will be implemented in Kailali, Banke and Dang Districts.

Sahaj-Nepal Agriculture Market Development Programme (NAMDP) Phase II

Swisscontact

The project aimed strengthening capacity of Bank to finance agri-SMEs in province 1. It focused on growth and investment in forward market linkages, strengthening the country’s commercialization, processing, and export of value-added agricultural products, particularly in maize, vegetables, cardamom, and dairy in Province 1.  It also provided financial and technical support to improve service provision and access to innovation for agribusinesses in these sectors. Additionally, it emphasizes optimizing the credit life cycle through digitization, using credit scoring models, promoting digitally enabled loan approval processes and offering innovative financial products to better serve the needs of agri-SMEs.

Youth and Small Entrepreneur Self-Employment Fund 

Youth and Small Entrepreneur Self-Employment Fund 

Youth and Small Entrepreneur Self-Employment Fund (YSEF, युवा तथा साना व्यसायी स्वरोजगार कोष) secretariat aims to provide self-employment opportunities to the skilled and unemployment youth to make their livelihood easier by providing them periodic loan. Bank and YSEF have an agreement on refinancing nodality targeting individauls/entrepreneurs involved in agriculture, livestock and small-medium enterprises in Gandaki province to uplift their living standard. Bank has provided loans to more than 130 individual entrepreneurs till date under this arrangement. 

Reducing Post-harvest Losses through Access to New Technologies (RePLANT)

IDE Nepal

Reducing Post-harvest Losses through Access to New Technologies (RePLANT) is program funded by USAID/BHA, which aims to improve the livelihoods and food security of smallholder farmers through accelerating their adoption of post-harvest hermetic storage technologies by extending last-mile delivery networks, incorporating access to finance and and crop insurance. The target area of the project was Dang & Banke district of Nepal. Bank relaunched & promoted Muktinath Krishak Bachat Khata and opened accounts of over 2,000  small holder farmers and encouraged them for saving. Also, Bank in collaboration with the project team conducted around 146 Business/Financial Literacy Training to small holder farmers of the target area with total beneficiaries number 4,716. 

Wholesale Rural Coop Lending for increased climate resilience of Small Holder Farmers

SNV/Dutch Fund for Climate and Development (DFCD)

This project conducted an assessment of the current financial situation and products available to rural cooperatives, along with their indebtedness levels, in Gandaki Province. This led to the development of a bulk lending product for MNBBL tailored to the needs of rural cooperatives and recommendations for optimal cooperative structures. Leadership Development and Account Keeping Management training sessions were held, and three cooperatives were provided with equipment and software support to strengthen their operations. Additionally, an assessment on agricultural market linkage for rural cooperatives was conducted resulting in development of a mobile app to establish a sustainable marketing system and support cooperative members and farmers in entrepreneurship development. Financial Literacy Training was provided to around 1200 members from 16 cooperatives. Furthermore, an assessment on climate-resilient inputs in was also conducted and provided Climate-resilient inputs and technologies to smallholder farmers through various cooperatives. A training manual for climate resilience capacity building was also developed, and Training of Trainers (ToT) as well as community-level training were conducted. Additonally, a preliminary Environmental and Social Impact Assessment (ESIA) and Gender Equality and Social Inclusion (GESI) analysis were conducted at two levels: MNBBL Bank's Kathmandu office and five cooperatives in Gandaki Province during the project period.