Samurdhi Micro Finance Program
Introduction
Samurdhi Bank Associations were established in 1996 to implement the Samurdhi National Programme in terms of the Sri Lanka Samurdhi Authority Act No. 30 of 1995 and the Micro Finance Division of the Head Office / Main Society , 335 Samurdhi Community Based Bank Societies at the Regional Level and 1,097 Samurdhi Community Based Banks at the Zonal Level are being implemented to increase the savings of low income earners and thereby increase their investment power, to provide the capital (credit facilities) required for the development of products and services and to reduce informal credit transactions with a view of to creating a profitable corporate model by freeing them from debt.
A Management Board consisting of 8 members has been established for the supervision and regulation of Banks and Banking Societies as per Sections 33 (1), 33 (2), 33 (9) of the Divineguma Act No. 1 of 2013. The Management Board issues orders to Banks and Banking Societies from time to time.
Objectives
- Introduction of new loan schemes for the banking system and issuance of necessary circulars and operating orders required for that.
- Issuing of Guidance, instructions required for other operations.
- Introducing deposit promotion programmes and issuing of necessary guidelines and instructions.
- Investing bank funds and issuing instructions at the local level.
- Carrying out microfinance insurance activities.
- Conducting National Level investigations in all banks and issuing instructions in this regard.
- Certifying final accounts and issuing orders for profit disbursement according to the audit reports provided for the final accounts of Samurdhi Community Based Banks and Bank Societies.
- Providing re-financing credit facilities to banks and conducting credit analysis activities.
- Acquisition/ Purchasing activities of lands for Samurdhi Community Based Banks and Banking Societies and providing funds for the construction of bank buildings and Asset Management.
- Assisting to convene the Samurdhi Community Based Management Board, submitting Management Board Papers and implementing those orders.
- Monitoring, progress control and conducting follow-up actions on all community based banks and banking associations.
- Coordinating with Samurdhi Beneficiaries, projects launched by recognized institutions and organizations through Community Based Bank Societies.
- Taking actions to make creative contributions of community based banking societies for the programmes implemented by the Livelihood and Marketing Divisions.
- Assisting in the affairs of the Samurdhi Bank Maha Sangamaya as per the Samurdhi Act (Section 34).
- Assisting in computer networking of Samurdhi Banks, Samurdhi Bank Societies, Main Society and Microfinance Sector.
- Taking steps to train officers and community leaders of Samurdhi Banks, Samurdhi Bank Societies.
- Introducing programmes to provide the necessary financial support for the programme to empower the poor community.
Bank Membership and Progress of Share Capital
Samurdhi Beneficiaries become members of the Samurdhi Community Based Bank by purchasing a share of Rs.500/- . They are becoming shareholders of the bank by that.
Types of Bank Deposits
- Member Deposits
- Non-Member Deposits
- Group Savings
- Children Savings
- Diriya Mata Savings
- Sisuraka Savings
- Dhana Shakthi Savings
Community Based Bank Loan Programme
- Identifying the entrepreneurial capabilities of low income earners including Samurdhi beneficiaries and providing necessary financing facilities to build the environment needed to overcome poverty through self-reliance are done under Community Based Debt Scheme.
- Several special loan schemes have been introduced and launched to meet the capital funds and instant financial needs of the members.
- Loans ranging from Rs. 25,000 to Rs. 2,000,000 are issued by Samurdhi Banks under various Debt Schemes for income generating projects. Accordingly, loans are also issued for immediate loan requirements for the fields such as livelihood development, cultivation and vocational training.
- Bank loan facilities are implemented for the requirements such as housing, consumer, disaster etc.. Maximum loan amount from Rs. 25,000 to Rs. 500,000 are issued.
- Loans ranging from Rs. 2,000,000 to Rs. 5,000,000 are issued by Samurdhi Community Based Bank Societies under the “Isura” and New Samurdhi Entrepreneurship Loan Scheme to meet the capital and financial needs of entrepreneurs who had succeeded through the Samurdhi Bank Loan Programme.
- A relief has been provided for Members to get rid of the lenders with high interest to easily meet the cash requirements through consumer, disaster, Swashkthi, Samurdhi Arunalu, Samurdhi Mithura Loan Schemes in case of immediate financial needs.
- An amount of Rs. 519,881.86 Mn.have been given to 12,608,212 Members as Samurdhi Bank loans by the end of the year 2024.
Category of Loans
- Cultivation Loan
- Consumer Loan
- Swashakthi Loan
- Disaster Loan
- Livelihood Revolving Loan
- Livelihood Development Loan
- Samurdhi Sampatha Loan
- Emergency Business Loans
- Divineguma Arunalu Loan
- Ran Pradeepa Loan
- Employee Consumer Loan
- Sahana Piyawara Loan
- Samurdhi Abhimana Loan
- Festival Advance Loan
- New Samurdhi Entrepreneurship Loan
- Samurdhi Mutual Loan
- Samurdhi Siyapatha Loan
- Youth Entrepreneur Loan
- Samurdhi Lakjaya Loan
- Samurdhi Lak Wasana Loan
- Samurdhi Laksara Loan
Promotional Programmes Implemented through the Microfinance Sector
Since the year 2000 as a self-financed unit, the main objective of the microfinance sector is to carry out various development programmes targeting the low-income community through Samurdhi Community Based Banking System through the interest income earned by the sector. For this purpose, the programmes implemented in the Department are as follows.
- New Year Savings Promotion Programme
Actions were taken to convey a message to the public about the name and services of Samurdhi Bank operating of 1097 Samurdhi Banks in a single day successfully giving priority to savings promotion programmes and a New Year's celebration and traditional games for account holders and other people who have engaged with the banks in conjunction with the Sinhala/Hindu New Year celebrations. Customers were rewarded with useful and highly valuable gifts for the money they deposited during that time. This was an opportunity for the people to gather in the respective areas and to nurture the cultural feelings of the community. Further, it is expected to strengthen the activities and to raise trust on Samurdhi Banks and promote the name of Samurdhi Bank in the community including low income earners by promoting them economically / socially.
- “Ran Pradeepa” Gold Pawning Service
Samurdhi Bank members facilitate to meet their financial needs quickly at subsidized interest rates, avoiding the difficulties of obtaining money by pawning their gold items for urgent financial needs.
- "Arunalu Instant Loan" Programme in relation with Samurdhi Community Based Banks
Introducing of Arunalu Instant Loan Programme by Samurdhi Community Based Organization. Functions for the Members through all community based organizations island wide. Facilitating to access to concessional and short-term loans are done by this as an alternative to loans obtained by Members of Community Based Organizations for their urgent cash needs from informal microfinance institutions / individuals at high interest rates and on various bonds.
- Training Activities
The trainings on Banking and other subjects for the staff working in 1097 Community Based Banking Network and 335 Community Banking Societies are coordinated by the Training Division of the Department with the Community Based Bank Funds.
The role of this unit is to develop the knowledge, skills and positive attitudes of the bank staff in order to provide a more efficient and effective service to the customer community.
Accordingly, actions are being taken to provide basic training that gives insight into the activities of the Bank on banking and accounting process to every Bank Officer. In addition to that, steps have been taken to train the untrained staff of Community Based Banks / Bank Societies on Community Banking activities and Community Banking accounting activities.
- Management Information Unit
Information Management of 1097 Samurdhi Community Based Banks is managed by the Management Information Unit of the Micro Finance Division. Accordingly, all Samurdhi Community Based Banks and Samurdhi Community Based Bank Societies are required to report their banking progress to the Information Management Unit on a monthly basis through the Forms provided and it has been planned to compile the data and analyze the current situation exists in Samurdhi Community Based Banks and submit information, build the required ratio analysis to evaluate the progress of Samurdhi Community Based Banks and conduct evaluations on Samurdhi Community Based Banks accordingly. Further, actions have been taken to transmit the information on Samurdhi Community Based Banks and Banking Societies to the Micro Finance Division using computer technology.
With the successful computerization of Samurdhi Community Based Banks, arrangements are being made to analyze and evaluate the current situation of Community Based Banks in a more effective and efficient manner. Arrangements have been made to implement a bank rating and an evaluation programme with the objective of transforming the entire banking system into sustainable financial units as well as employee motivation. The programme has been planned to be implemented with improving in every year.
