The "Formulation of a Vision for the Development and Expansion of the Microfinance Sector in Sudan" is a project commissioned by the Central Bank of Sudan (CBS) in recognition of the important role that a vibrant microfinance (MF) sector can play in the economic development of the country, particularly in terms of poverty reduction. In commissioning the work, the Central Bank chose UNICONS to undertake the formulation of the strategy. While playing the lead role in the implementation of the project, UNICONS collaborated with Environmental Quality International (EQI). The team spirit created in implementing the project combined Sudanese expertise with regional and international experience, ensuring that maximum benefit was made from adopting best practices, and adapting regional success stories to the Sudanese context.
The primary objective of the project is to formulate a strategic framework that would enable the MF sector to play a lead role in:
- Supporting sustainable livelihoods by alleviating poverty and building assets that can minimize vulnerability and exclusion.
- Augmenting productive investment for job creation.
- Contributing to financial development by integrating informal microfinance into the formal sector.
The formulation process adopted a comprehensive consultative approach that emphasized the need for (and supported the development of) coordinated actions between various stakeholders, including banks, non-government organizations and the private sector. The consultative process that was set in motion took into consideration the views, challenges and priorities of various MF stakeholders (governmental bodies, financial intermediaries, NGOs and the donor community) with the aim of reaching a consensus on the priority actions and policies that needed to be adopted in favor of this important sector.
The first stage of project implementation focused on providing a full understanding of the status of the microfinance sector in Sudan, and a major study emanated from it, entitled "Situational Analysis of the Status of Microfinance in Sudan". Complementary studies also included the impact of macroeconomic policies on microfinance while the second detailed legal aspects impacting on the financing of small and micro-enterprises in Sudan. A two day workshop was organized by UNICONSthat brought together over 200 individuals representing various stakeholders from community based organization, NGOs and multilateral organizations (World Bank, IMF, UNDP) to Bank officials and government civil servant as well as the private sector. The workshop discussed the major problems and constraints facing the MF sector and identified key issues to be discussed further in roundtables of smaller more specialized groups.
The second stage focused on the consultative process whereby various stakeholders were engaged in the formulation of the vision for microfinance in Sudan. This participatory process has ensured legitimacy for the vision, as well as commitment by the various stakeholders to supporting it. Most importantly it has sensitized policy makers, at different levels, to the need for coordinated action in support of the sector. The roundtable discussions and reports that ensued from them formed the basic material for the formulation of the strategy and accompanying policy briefs.
The project culminated in a well publicized Conference that took place in Khartoum in September 2006 and witnessed the launching of the vision. This was presented by UNICONS in the form of a comprehensive strategy designed to transform the microfinance sector into a demand driven financially sustainable vibrant sector. It outlines the roles of each of the relevant stakeholders and makes specific recommendations to be implemented over a five year period.