BFC Establishes Agricultural Credit Scoring Solution for a Leading MFI in Georgia

score-ge In March, BFC successfully completed the introduction of a credit scoring solution for a leading microfinance institution (MFI) in the Caucasus. The BFC project team, consisting of Senior Credit Scoring Experts, Peter Hauser and Dan Pavelesku, worked closely with the client institution over five months to develop a statistical credit scoring system for agricultural microenterprises that will provide an accurate risk assessment of potential clients at the time of application.

Due Diligence Contract Extended with Leading IFI

BFC extends its multi-year advisory contract with a leading development bank. Under the contract, which was initiated in 2009, BFC’s dedicated due diligence team conduct onsite visits to banks throughout Central, South and South East Asia. As of April 2013, comprehensive institutional reviews of more than 170 banks in 19 countries have been completed.

Project Overview

To learn more, please contact Javier Fargas at

How Microfinance will benefit from “Big Data”

Credit scoring is a proven tool for making faster and more effective credit decisions. However, as shown in the recent presentation, “Enhanced Data Tools”, delivered by Peter Hauser, BFC Senior Bank Advisor, at the 9th Global Microfinance Forum in Vienna, such “big data” can also be used to develop targeted marketing approaches and social performance metrics, and improve portfolio risk management.


Microfinance and the Efficiency Challenge — BFC sponsor Uniglobal at the 9th Global Microfinance Forum in Vienna

“Microfinance deserves the credit for opening up financial services to millions of excluded people, for introducing services that satisfy unserved demand. However, despite (or because) of the industry’s progress, microfinance has mostly failed to bring costs down. In many regions microfinance remains an expensive to produce and an expensive to buy service, as a result of operating under unchanged and outdated business models. It is these models that need to change first, especially in maturing markets, to push costs down more rapidly.”


How banks feast while clients ail

The profit of Georgian banking sector increased in proportion with the growth of the blacklisted clientele during last five years. Some sector analysts suspect that banks have been spreading nets out to trap and impoverish clients. Others think the key reason is loose regulation, inadequate risk management and gaps in consumer rights’ protection.

The tripled profit figure Georgian banking sector enjoyed in 2007–2011 alongside the similarly increasing list of defaulting clients at Creditinfo Georgia, a private company compiling credit histories, sends a signal of alert that the crisis-affected consumer needs a help.


Georgian banking sector recoils

Georgian banking sector is shrinking insignificantly but steadily in the post-election period thus bespeaking of economic slowdown in the country.

By November 1, 2012, total assets of Georgian commercial banks incorporating 19 banks, decreased by 0.5% compared to the previous month, while loans and deposit portfolios sagged by 0.1% and 0.5% respectively. In September assets shrunk by 1.6% and deposits reduced by 4.1% while loans grew by 1.8%. As of November 1st, 2012, total assets decreased by GEL 71.3 million (by 0.5 percent) and constituted 1 GEL 4 billion. The banking sectors own funds (equity capital) equal to GEL 2.3 billion which makes up 16.4 percent of commercial banks’ total assets. In October 2012, the banking sector finished with the net loss of GEL 36.8 million.


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