Applications for this consultancy will be received ONLY via e-mail. Please read the job description thoroughly before submitting your application. Instructions on how to apply may be found at the end of this post.
Project background
IFC a member of the World Bank Group is the largest global development institution focused on the private sector in emerging markets. We work in more than 100 countries, using our capital, expertise, and influence to create markets and opportunities in developing countries. For more information, visit www.ifc.org.
The Financial Institutions Group (FIG) at IFC collaborates with financial institutions to enhance their capacity to offer financial services to crucial underserved segments of the market, including microfinance, SMEs, women, and agriculture. Our projects encompass a wide range of areas, such as microfinance, banking, insurance, financial products focused on women, and digital financial services.
Objective of the assignment
The individual consultant will support a comprehensive assessment of the microfinance sector in Malaysia, focusing on:
- Operating Environment: Review and analyze the operating environment and regulatory framework applicable to microfinance service providers including key stakeholders, ecosystem, identification of market constraints, and future opportunities for upstream work on enabling environment.
- Competitive Landscape Analysis: Assess the current landscape and conduct mapping of FIs offering micro and small business lending, including MFIs, development banks/ DFIs and government entities, and bank institutions offering microcredit, and their access to capital markets.
- Identification of Potential Clients: Identify opportunities with financial institutions and other stakeholders for potential IFC advisory, upstream or investment support to enhance and expand financial inclusion for micro and small businesses.
Scope of Work and Tasks for Consultant
Component 1: Operating Environment
- Conduct a desk review of operating environment for financial service providers catering to micro and small business segments. This will include overview of regulatory framework and support infrastructure, MSME ecosystem, key stakeholders, and government programs and facilities pertaining to the sector including the role of CGC and other government entities and donor programs.
- Operating environment analysis, including analysis of regulatory framework and support infrastructure. I.e. how the regulatory framework creates incentives or barriers to financial service providers in the sector, implications of the governance structure and framework on the industry, and recommendations for regulatory and policy improvements. Evaluate the current and upcoming regulations impacting the sector, and their potential influence on market dynamics.
Deliverables: Prepare a report outlining the operating and regulatory environment, highlighting challenges and opportunities for IFC engagement. This will include an overview of current operating environment; findings from discussions with FIs, financial regulators, central bank, and/or other relevant stakeholders to review the current policy environment and regulations and support infrastructure impacting relevant FSPs; and identification of recommendation and opportunities for reform and IFC support to regulators and market players.
Component 2: Competitive Landscape
- Identify and profile key institutional providers of financial services to low-income segments, microenterprises and small business loans, including MFIs, development banks/ DFIs and government entities, and bank institutions offering microcredit. These would include FIs under the purview of Bank Negara Malaysia (BNM) and other relevant ministries (Ministry of Entrepreneur Development, Ministry of Finance, Ministry of Agriculture, etc.). Profile would include the type of institution, size, market share and product/service offering.
- For key players, conduct desk research (sources may include industry reports, financial statements, and any other reliable secondary sources of information) to collect financial and qualitative non-financial data. Gather organization information (e.g. ownership structure, key sponsors etc.) and analyze strategy, business models, funding structures, and sustainability of these organizations, and portfolio including the volume and composition and performance of the loan portfolio, customer segments, returns, repayment, default.
- The consultants will need to engage with the fintech companies to understand the organization's involvement in supporting the microfinance sector, explore any current initiatives, and assess their future plans for expanding or deepening their engagement in this area, including any specific plans to address microfinance loans. The list of fintech organizations to be interviewed will be made available to the consultant.
- Examination of the level of integration with the capital market within the microfinance sector, catering to low-income segments, microenterprises and small business segments, including an evaluation of the volume and diversity of financial instruments, the availability of short and long-term financing options, and the accessibility of government and public investment sources. Assess the extent to which microfinance institutions (MFIs) in Malaysia have access to the following financial instruments through capital market or other sources, such as
Debt instruments: bonds, loans, and other debt securities
- Equity instruments: stocks, shares, and other equity securities
- Alternative instruments: securitized assets, asset-backed securities, and other innovative financial products
- Risk-sharing mechanisms: credit risk sharing (credit guarantee, etc.), market risk mitigation (derivatives or other instruments) and operational risk management (insurances)
- Government-backed fundings: Such as Government-guaranteed loans or bonds, grants or subsidies for specific projects or initiatives, tax incentives/exemptions or other fiscal benefits for MFIs.
- Analyze historical trends and potential prospects for social-linked financial initiatives, risk-sharing mechanisms, guarantees, securitization practices, equity, and credit facilities.
Deliverables: Prepare a report outlining the competitive landscape and profiling of FIs in the sector, and level of integration with the capital market. The report will include qualitative and financial information of key players.
Component 3: Identification of Potential FIs for IFC Advisory or Investment Support
- Shortlist organizations in the sector with microfinance portfolio and promising investment potential based on the information and data analysis under components 1 and 2. This will need to be done in close coordination with IFC staff and may require multiple missions/interactions with potential organizations. Assist in organizing and participating as a specialist in group discussions with shortlisted FIs and with peers from IFC on FIs readiness and potential/opportunity for advisory or investment engagement and possible financing structures.
- Develop a draft proposal for each shortlisted entity, outlining potential areas for IFC engagement.
Deliverables: Help shortlist key players with investment and advisory potential, organize and participate in discussions with selected FIs, and help draft proposals for engagement with shortlisted organizations, outlining potential areas for IFC advisory or investment support.
Timeline: The selected candidate will be hired for a period of 50 working days starting January 10 through June 15, 2025.
Reporting: The Consultant will report to Ms. Ananya Wahid Kader, Senior Operations Officer.
Qualifications
- Minimum 10 years of experience in financial sector research, regulatory analysis, or investment/ advisory.
- Strong understanding of Malaysia's financial sector, microfinance industry and governance framework, and capital markets. Contacts and network in the financial sector including with FIs and regulators in Malaysia is a must.
- Proven ability to conduct desk research, analyze financial and market data, and assess regulatory environments.
- Excellent written and verbal communication skills for stakeholder engagement and report writing.
Application
Professionals meeting the selection criteria are invited to submit their application via e-mail by sending an updated CV to Ananya Wahid Kader <[Confidential Information]> by December 17th, 2024.
We are proud to be an equal opportunity and inclusive employer with a dedicated and committed workforce, and do not discriminate based on gender, gender identity, religion, race, ethnicity, sexual orientation, or disability.