The mission of Civic Development Bank is to increase access to credit. We serve entrepreneurs who live or work in low-income neighborhoods, who are unable to receive traditional financing from banks. To make the unit a pioneer in joint and participatory work as well as effective networking to build a Microfinance-oriented culture aiming to promote the Microfinance activities in order to ensure the sustainability of the effective goals of Microfinance as a mechanism to reduce poverty in Nepal.
Facilitating the sustainable accessibility of the economically active poor “under-served in rural, urban and semi-urban areas” to financial services by expanding and developing the Microfinance sector.
To carry a regulatory and supervisory role that works on passing laws and policies that encourages the development of Microfinance in Nepal. Designing and executing programs to build the institutional and technical structure and provide technical assistance and support to the Nepalese
Promoting the Microfinance industry through offering incentives and participating in media and networking activities and coordinating with governmental agencies, and public organizations.
Designing and introducing applicable models for marketing and developing the Microfinance industry on the National level.
The two main mechanisms for the delivery of financial services to such clients are:
(1) Relationship-based banking for individual entrepreneurs and small businesses
(2) Group-based models, where several entrepreneurs come together to apply for loans and other services as a group.
Needs for Microfinance
Nepal is among the poorest countries in the world, and the poorest in South Asia with about 38% of the population below the poverty line.
Most of the population lives in rural areas (85%), while nearly 80% of the employment is in agriculture and related activities.
There is an estimated 17.6 million people in Nepal lacking access to financial services.
The current conflict in Nepal has a negative impact on the access of the Nepali population to financial services, especially in rural areas. In fact, most financial institutions are reticent to operate in rural areas due to insurgency in Nepal. The most affected commercial banks have reduced the size of their rural network in recent years, already downscaled by cost-savings measures, which added to the current financial difficulties faced by the two state owned commercial banks in Nepal.
Microfinance providers have faced major challenges in extending their services to remote and insecure locations. However, perceived as closer to the need and aspirations of people in rural areas. Nevertheless, outreach has stagnated in recent years as their expansion has been impeded by security concerns.
TARGET CLIENTS :
The target group of CDBL consists of land-less marginal landholders, tenants and other agricultural laborers the families owning not more than 1 Bigha (0.67 hectare) in Terrai and 15 ropani in Hill side of land and with earning of not more than Rs. 7669 income per year will be considered as an eligible for membership under CDBL group members will be women from the target households.
The criteria used by CDBL to select its clients are: limited assets, no sources of regular income , no active loan with another microfinance provider. The criteria are in place to make sure that the poorest of the poor are eligible to receive direct support from CDBL. The bank uses Participatory Rural Appraisal (PRA) techniques, employing various demographic measures, to determine whether clients match the criteria or not.
Microfinance has been playing vital role in the field of poverty reduction, therefore, CDBL has been implementing the program in Dhading district of Nepal. Basic characteristics of microfinance program are:
1. Targeted to the poor and poverty reduction.
2. Identification of target households through PWR method.
3. Effective pre group training.
4. Hundred percent women member.
5. Saving, credit, micro insurance and money transfer services.
6. Simple procedures of operation.
7. No tangible collateral.
8. Five members group approach under a single umbrella of 10-25 women in a center.
To improve the competency and socio economic condition of poor community, CDBL is providing different loan Services in diverse categories without any collateral in simple mode of operation. These loan services are:
1. General Loan
2. Discipline Loan
3. Seasonal Loan
4. Business Group Loan
5. Goodwill Member Loan
CDBL has design different types of saving account for the member of microfinance. CDBL always motivate its member to take benefits from saving. CDBL has been providing 8% to 13% interest in different saving accounts to encourage and develop saving practice for better and safe life. The names of these saving products are listed below:
1. Compulsory Saving (Group Saving)
2. Center Management Fund
3. Individual Saving
4. Special Saving
5. Fixed Deposit
6. Festival Saving
7. Group & Center Welfare Saving