When Size Matters: Improving Microfinance Outreach in Aceh through a Revitalized Provincial Rural Bank Network

Event:

When Size Matters: Improving Microfinance Outreach in Aceh through a Revitalized Provincial Rural Bank Network

01 November 2009
Author / Speaker: 
Mariano Cordero, SMEC International Pty Ltd
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Rizal Matondang, ETESP Project Management Office
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The Earthquake and Tsunami Emergency Support Project of the Asian Development Bank transformed twelve (12) weakened rural banks into one strong banking institution which provides microfinance services to micro and small enterprises in disaster-stricken Aceh, Indonesia.

The banks, owned by the Aceh Government, were merged as one after a thorough assessment. To jumpstart operations, the merged organization made use of a newly designed hiring and rehiring criteria, new standard operating procedures, state-of-art information technology, and re-equipped and refurbished offices. Staff were also re-tooled through intensive training and mentoring. Two pilot branches became models and training centers, and the rest were converted to branches. Moreover, the Government of Aceh was also given re-orientation trainings to enable them to better guide and manage the newly-merged banks.

The consolidated bank has now become a major microfinance provider, and is the biggest rural bank in Aceh. It has strengthened its position in serving underserved areas in the province, and can potentially be expanded to other areas. Now, its assets are larger than all the combined wealth of all the private rural banks in the province. 

Geographical Focus: 
Indonesia
Type of Content: 
Project Stories

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