Theme 3: Financial linkages in Mali: Self-reliance and liquidity balancing versus liquidity supply and donor dependence
Since the mid-1980s microfinance has evolved rapidly in Mali. As of 2003, the microfinance sector consisted of 41 networks with 752 local microfinance institutions (MFIs) and a total outreach of 612,000 clients. Since that time, the government-owned agricultural bank, Banque Nationale de Développment Agricole (BNDA), has been the main bank offering financial services to MFIs. From the beginning BNDA acted primarily as a channeling bank on behalf of donors until the mid 1990s when it began to act more as a wholesaling bank, offering loan and deposit services to several MFIs in the country. This article discusses and compares the financial linkages that BNDA has with two of the 41 MFIs networks in Mali. First it looks at the liquidity balancing linkages with Kafo Jiginew, a regulated savings and credit cooperative, whose aim is to obtain self-reliancy and cut the (temporary) linkage cords. The second case describes BNDA’s financial linkage with the CVECA-ON (Caisses Villageoises d’Epargne et de Credit Autogerees-Office de Niger) network. This linkage seems to be motivated by credit expansion more than liquidity balancing.