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  1. 1. NewBank Microfinance: Microcredit in the Ukraine Fuqua School of Business Duke University Holly Dice, Andrew Khoo, Sara Kirchoff, Robert M. Little& Hartaj SIngh
  2. 2. Agenda
    • Scenario
    • What is Microfinance?
    • Characteristics of Microfinance Loans
    • Overview of Ukraine
    • Business Plan
    • Key Takeaways
    • Conclusion
  3. 3. Scenario
    • Ukrainian-American entrepreneur wants to give back to his native country by fostering small and family owned businesses
    • Willing to provide $2.5MM in interest free loans
    • Wants to verify feasibility and sustainability of a for-profit microfinance lending institution in the Ukraine
  4. 4. What is Microfinance?
    • Providing financial services to the poor and micro enterprises
    • Currently 7,000 microfinance Institutions worldwide ($2.5 billion).
    • Individual and group-based lending
    • Small size of loans makes it inefficient for commercial banks to target these markets
    • Successfully pioneered by Grameen Bank in 1976
  5. 5. Characteristics of Microfinance Loans
    • Size: $25 to $100,000
    • Term: 6 months to 2 years
    • Collateral: typically none
    • High interest rates: 25% to 51% in Asia
    • Low default rates: