Microsoft Word Microfinance development in Uzbekistan Eng doc

Prospects of MFO merger 
In long-run the stronger MFOs with established client bases and market shares could 
benefit from reorganizing into fully functional regulated financial organizations capable to 
offer their clients a wider range of services.
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Taking into account that microfinance services may be provided by various institutions. 
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The example of this is the merger of two NGO-MFOs undertaken with support of Support programme for 
development of mountain settlements (SPDMS) and Fund of entrepreneurship support in Tajikistan, that 
resulted in the establishment of a licensed microfinance bank (with support of IFC). 
In Mongolia, “HAS” 
NGO-MFO 
has merged with Govin Ekhel (Mercy Corps) that resulted in 
establishment of financial company that later has been reorganized into “HAS” bank. 
In Cambodia, “The association of local agencies of economic development” (ALAEDC) has been 
reorganized from an 
NGO-MFO 
into a bank, thanks to considerable aid from donors. The initial NGO has 
delegated its assets and obligations on long-term credits provided by donors to the new AMAERK bank. At the 
moment of reorganization the NGO retained 45% of ownership capital, and foreign investors bought 49% of 
shares of the new bank. At present AMAERK has more than 85 thousand clients. 
In the Philippines, after six years of successful activity as an 
NGO-MFO
, the Centre of Agricultural 
Development (CAD) became the first organization in the country that has been reorganized into an agricultural 
bank. It became possible as a result of long-term support by donors and insistent efforts of CAD on establishing 
the government position on this issue that resulted in obtaining government support for this reorganization. By 
the end of the first year of activity, the number of active members increased by 90%, the number of active 
credits increased by 70%, and the total amount of the credit portfolio has grown by 134%. Despite such rapid 
development, the indicator of credit repayment ability remained very high, averaging 98-99%. 
In Armenia, “The catholic assistance service” and “Help the children” (USA) have merged and 

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Small-sized MFOs with a low level of capitalization in most cases will not be able to 
continue their activity without regular subsidies. Consolidation by merger of small-sized 
MFOs, where fixed costs, such as surcharges, expenses for staff, equipment and training can 
be consolidated would promote the strengthening of these organizations.