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1. The First Microfinance Bank Ltd Pakistan

2. The First Microfinance Bank Ltd Pakistan
The First Microfinance Bank Ltd Pakistan
(FMFB-P)
INTRODUCTION
The FMFB-P was established in 2002 as a nation-wide microfinance bank,
licensed by the State Bank of Pakistan. It operates under the Aga Khan Agency
for Microfinance (AKAM). FMFB-P was created through a structured
transformation of the credit and savings section of the Aga Khan Rural Support
Programmer’s (AKRSP) integrated development programme to pioneer the
microfinance sector in the country in 1982, beginning in Gilgit-Baltistan and
Chitral.
The First Microfinance Bank Ltd (FMFB) is the result of the transformation of
the microfinance program of the Aga Khan Rural Support Program (AKRSP),
with more than twenty years of experience, into a separate, specialized
microfinance bank. In 1996, the AKRSP started to streamline its microfinance
program separately, with the objective of creating a separate entity, capable
of mobilising savings. FMBL has benefited from the long experience and
transfer of key employees and technologies from AKRSP. The First
MicrofinancefBank Ltd was established as a non-listed public limited company
under the provisions of the Companies' Ordinance in November 2001 and
licensed as a Microfinance Institution (MFI) under the provisions of the
Microfinance Institutions Ordinance 2001 in January 2002. The main
shareholders are the AKRSP (45.5%), the Aga Khan Fund for Economic

3. The First Microfinance Bank Ltd Pakistan
Development (30.30%) and the IFC (24.2%). FMFB formally started operations
in February 2002, taking deposits through its first branch in July 2002.
FMFB-P was established with the mission to respond to poverty and
contributes to the social and economic well-being of society by providing
opportunities to thousands of under-privileged households. The Bank has a
unique banking model that funds its entire loan book through self-generated
deposits – a system very few microfinance providers are offering around the
world. Through targeted financial and multi-sectoral products and services
based on the evolving needs of the poor, FMFB-P enables its clients to
strengthen their entrepreneurial base and build financial, physical and human
capital to secure their future.
FMFB-P operates through a network of 137 outlets, including an alternate
delivery channel through the Pakistan Post’s Sub-Offices across Pakistan. In
the last 12 years, FMFB-P has disbursed over PKR 28.6 billion through 1.34
million loans and accumulated a deposit base of PKR 7.8 billion. According to
Microwatch, the deposit base of FMFB-P constitutes around 23% of the total
market share in the Microfinance banks in Pakistan, as of December 2013. A
vast majority of poor people live in rural areas in Pakistan, while women
constitute more than half of the population living in poverty. To meet this need,
34% of FMFB borrowers are women entrepreneurs and 61% of the borrowers
are in rural areas. Over the years, FMFB-P has disbursed 400,831 loans to
women, amounting to PKR 7 billion.
Vision
To enable the disadvantaged population to build a sound and secure future
with dignity and pride and not merely to survive - alleviation of poverty
through sustainable economic development.
Mission

4. The First Microfinance Bank Ltd Pakistan
To help strengthen the entrepreneurial base of the economically
disadvantaged populations across the country by seeking to marry
entrepreneurship with capital formation in not only rural areas but also the
major population centres.
To provide people scope to expand their economic base, and over time, to
support diversification beyond traditional small enterprises.
The Bank will endeavour to introduce good practices, ethical precepts and
the highest standards of rectitude in the conduct of business and will remain
respectful of the needs of the poorest segments of society.
Institutional Achievements (2002-13)
Year Milestone
2002 The FMFB-P was inaugurated by the President of Pakistan, in the
presence of His Highness the Aga Khan.
2003 Received the short term credit rating of A1+ and medium to long term
rating of A+ by JCR VIS - this rating was maintained for 5 consecutive
years.
2004 Awarded ‘5-Diamond’ Status for its high level disclosure on the MIX,
CGAP’s (World Bank Affiliated) web portal.
2005 FMFB-P became the only MFI in Pakistan to become a member of the
prestigious global microfinance network.
2006 Awarded the top “Financial Transparency Award 2006” by CGAP and
was the only MFI in Pakistan to get this award for two consecutive
years.
2007 Ranked 14th amongst the top 100 MFIs of the world in the 2007 MIX
Global 100 Composite Rankings.
Initiates a unique partnership with the Pakistan Post for increasing its
outreach to remote areas.

5. The First Microfinance Bank Ltd Pakistan
2008 Ranked 7th amongst the top 100 MFIs of the world in the 2008 MIX
Global 100 Composite Rankings.
FMFB launches its products through the Pakistan Post Office outlets.
2009 A collaborative agreement was signed with the Harvard University for
social performance research.
A social rating evaluation funded by IFC was carried out by M’Cril –
an independent credit rating agency.
2010 Awarded a certificate of recognition in the silver
category for reporting on social indicators to the
Microfinance Information Exchange (MIX) for two
consecutive years by CGAP.
FMFB client awarded National Award for Micro
Entrepreneurship organized by Citi Foundation and
PPAF.
2011 Achieved a credit rating of A1 (short term) and A (medium to long
term) again as announced by JCR-VIS.
2012 FMFB clients awarded National & Regional Awards for Micro
Entrepreneurship organized by Citi Foundation and PPAF.
2013 FMFB client awarded National Award for Micro Entrepreneurship
organized by Citi Foundation and PPAF.
Maintained its credit rating of A1 (short term) and A (medium to long
term), as announced by JCR-VIS.
Transitions
 FMFB offers a full range of financial products, such as deposits and
loans but also transfer of funds.
 It provides different loan products, adapted to its diverse clientele, in
urban and rural regions.
 Business Group Loan
 Solidarity group lending, Rs.5,000-50,000, 15% annual interest rate.
 Business Committee Loan
 Larger solidarity groups, Rs.3,000-50,000, 12% annual interest rate.

6. The First Microfinance Bank Ltd Pakistan
 Individual Loan
 Microenterprises. Rs.5,000-100,000, 16% annual interest rate
 Group Loan
 Village banking methodology, rural areas, 10% annual interest rate
 Urban Group Loan
 Solidarity groups, 3-10 borrowers, Rs.3,000-50,000, 15% annual
interest rate
 House Improvement Loan
 Rural areas, 5 or more borrowers in village or women organisations,
Rs.1,500-50,000, 15% annual interest rate
 Employee loan scheme
 Low-income employees, Rs.5,000-40,000, 10% annual interest rate
 FMFB offers current accounts, savings accounts and fixed term deposits
(1 month - 2 years) with interest rates varying from 1 to 3%. Only Rs.5
is required to open a saving account.
 FMFB also proposes additional services, such as cheques operations,
micro insurance (with loan and life coverage) and wire transfers.
Strategic Objectives:
Outreach - Increase access to financial services for the poor population in
urban and rural areas, especially women.
Sustainability - Safeguard permanence of services for the poor.
Impact - Monitor social indicators to maximize the positive impact on the
quality of life for the poor.
Transparency - Ensure good practices, integrity, ethical principles and
highest standards of integrity in business conduct.

7. The First Microfinance Bank Ltd Pakistan
Services - Complete Banking Solution
The First MicroFinanceBank Ltd offers complete banking solutions to its
clients in Pakistan.
Bullet Credit
The Bank offers a wide range of loan products to serve the diverse financial
needs of the poor in the rural, urban and peri-urban areas in Pakistan,
especially women.
Bullet Deposits
The FMFB-P is the only microfinance bank which funds its entire loan book
through local deposit mobilization without relying on any commercial
sources of credit.
Bullet Micro-insurance
Micro-insurance is offered with credit and saving services to all borrowers to
provide protection against life, health and asset related liabilities in the
future.
Bullet Other Banking Services
FMFB-P offers funds transfer, cheque collection, pay order, demand draft and
remittance facilities as well as real time online banking servicefor safe and
secure business activities across the country