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Case Study:  Savings


FMFB Pakistanís social performance research analyst conducts an information disclosure session with female members of the local community as part of FMFB
Pakistanís drive to promote its services including deposits.FMFB Pakistanís social performance research analyst conducts an information disclosure session with female members of the local community as part of FMFB Pakistanís drive to promote its services including deposits.While microfinance can help alleviate poverty through lending and productivity, micro savings can help to protect households from what is often not only a lower income, but an unpredictable one.

In rural and remote areas where financial services are not available, many people save but not in formal institutions. Instead, they buy extra livestock or gold or they put their cash under a mattress and hope that it will not be stolen. For them, there is nowhere to store money safely. In response, AKAM is moving all of its entities to become deposit taking, if the regulations allow, to help move its clients away from this sort of savings. Some institutions, like FMFB-P, work in rural and remote areas because part of their mission is to make savings accessible to everyone so that they can build their assets and save for the moments they deem important in life, whether it is for the education of a child, a wedding in the family or medical expenses for the birth of a child.

In 2010, the number of new deposit accounts in FMFB-P increased by 36,958 to a total of 217,006 accounts, registering a growth of 20 percent over 2009. Of all of FMFB-P’s depositors about 85 percent are micro savers and they have an average savings of less than US$ 495.

FMFB-P’s entire loan book is funded by deposits and, in 2011, the bank will continue to enhance the sustainability of its growth of deposits with the objectives to provide saving services to the poor so that they can build assets over time; and increase its outreach.

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