CITI: CELEBRATING HALF A CENTURY OF COMMITMENT TO 'RESPONSIBLE FINANCE' IN PAKISTAN

MICROFINANCE: THERE'S NOTHING MICRO ABOUT IT!

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Mar 5 - 11, 20
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Citi established its presence in Pakistan in 1961 and over the last 50 years, has invested significantly in the country and its communities, introducing a number of banking 'firsts' to the Pakistani banking industry. Today, Citi is viewed as the leader in introducing innovative products from its over 100 geographies and tailoring them to local market trends and requirements. Moreover, in alignment with its key principle of 'responsible finance', Citi Pakistan has recently won two global awards, for its 'More than Philanthropy' approach towards corporate social responsibility in the country.

Supporting microfinance as a tool for poverty alleviation is a key priority for Citi and the Citi Foundation. Citi has partnered with various microfinance investors to develop appropriate products, distribution mechanisms and financing to broaden and boost financial inclusion for underprivileged segments of our communities. Citi has focused on providing direct and structured financing, individual lending through partner MFIs, transaction services, access to local capital markets and microfinance insurance products to meet the needs of low-income groups.

In Pakistan, Citi has pioneered the microfinance community landscape by partnering with various MFIs and NGOs to bolster the development of small and medium scale enterprises. As a result of Citi's efforts in Pakistan, the microfinance sector has achieved increased scale and a broadened product suite, as well as provided expanded access to financial services and opportunities for the clients that MFIs serve in the country.

Amongst other investments in Pakistan, a key demonstration of Citi's commitment to the local communities was through the three-year (2007-2010) Citi Network Strengthening Program (CNSP), which was a partnership between the Small Enterprise Education and Promotion (SEEP) Network and the Pakistan Microfinance Network (PMN). CNSP resulted in developing the network as a vital body that aims to enhance capacity building within the microfinance industry in Pakistan.

Amongst other outcomes was the development of an online performance review system in Pakistan, which has now been adopted as a best practice by Sanabel in the Middle East/North Africa region and the Microfinance Council of the Philippines.

"I don't think we could have done this without the support we had from Citi Foundation," said Syed Mohsin Ahmed, CEO of the PMN. 'With this support we were able to improve our data systems so we already had branch level data from all our members. We used this data to improve our influence with donors and government leaders. When the crisis came, we were able to use the system we had built and the relationships we had to deliver a quick response. The result was that, for the first time, microfinance institutions were included as part of the government's response to a crisis.'

The Citi-PMN partnership also played a crucial role during the recent floods in Pakistan, which left one fifth of the country's land mass under water. The PMN immediately surveyed all of its members and compiled a registry of all the branches and clients of its members that had been affected by the floods. With this information, PMN and its members developed a coordinated response plan that they sent to donors and investors.

Bob Annibale, Global Director, Citi Microfinance & Community Development, said, 'The Citi Network Strengthening Program has played a defining role in the development of the microfinance sector in Pakistan. During my last visit to Pakistan for the Citi Micro Entrepreneurship Awards, I had the opportunity to meet with the PMN seniors and members in Islamabad. Through this partnership, PMN has expanded its contributions to the sector, including its valuable research on key issues and by being a key driver in the development of a microfinance credit bureau in Pakistan. Such an initiative is an industry first in Pakistan and will go a long way in impacting client and microfinance institutions behavior and their code of conduct.'

Additionally, Citi and the Citi Foundation have supported thought leadership and capacity building in Pakistan for microfinance stakeholders. 'Citi Pakistan is a longstanding partner for Pakistan's premier business school, LUMS, particularly in the field of microfinance. We joined hands with Citi and the Citi Foundation to set up the first microfinance research wing at LUMS and also successfully completed a microfinance training program for middle and top management of local microfinance institutions in Pakistan through an earlier $65,000 Citi Foundation grant,' said Zahoor Hassan, Vice-Chancellor at LUMS.

Each year, as a demonstration of its commitment to the field of microfinance, Citi also organizes a micro-entrepreneurship awards program in conjunction with a World Bank NGO, the Pakistan Poverty Alleviation Fund (PPAF). The Citi Micro-entrepreneurship Awards (CMA) program strives to ensure that small business owners throughout Pakistan are celebrated for their efforts in creating sustainable businesses in their communities. The program's greatest success has been in increasing global awareness of the important role that micro-entrepreneurs play in their local economies, and the significance of microfinance as a poverty alleviation tool. This is the 8th year that the program is running in Pakistan.

Additionally, in the aftermath of the recent floods, Citi partnered with the PPAF on a microfinance disaster relief program, based on a $70,000 grant from the Citi Foundation - through this program, vulnerable groups of entrepreneurs, particularly widows, disabled flood victims, and the ultra poor were given grants as well as hands on entrepreneurial training to restart their livelihoods.

In recognition of its commitment to the microfinance cause in the country, Citi Pakistan recently won 'Best Community Program' in the poverty alleviation category at the Asian CSR Awards. 'What truly differentiates Citi is its innovative approach to responsible finance - the Thardeep Rural Development Program worked with Citi and the Citi foundation to launch the first ever village tourism microfinance program in Tharparkar, Sindh. Most importantly, measurable results marked the success of this initiative - 150 locals set up their own businesses, increasing tourist traffic significantly,' said Sonu Kangharani, CEO of the Thardeep Rural Development Program.

'A marked reduction in social issues and discrimination is also occurring as a result of this community engagement program, as it has increased harmony amongst diverse groups in Thar as well as provided a means of income generation for women. It has also reduced environmental degradation and aridness of the land through nurturing the land via tourism,' added Sonu.

Whilst 2011 marked Citi's golden jubilee in Pakistan, this year is Citi's 200th anniversary worldwide - alongside introducing latest financial products and services to the Pakistani market, Citi Pakistan continues to invest in the communities where it operates. Microfinance remains a key priority for Citi and the Citi Foundation and an important tool for reducing the socio-economic gap that currently exists between various elements of society.