In Myanmar, the majority of the farmers are saving informally either through savings groups, through purchase of gold, or other risky mechanism. These informal methods carry a high risk, which usually put customers in a precarious position. There is also an opportunity for Proximity Finance to cultivate a saving habit among its customers while educating its customer’s base on the benefits of savings with a formal institution.
Proximity Finance is poised to step in to offer the deposit service through its branch channels to build both the deposit base and expand on the services provided by Proximity Finance. This would put Proximity Finance on equal ground with its competitors who already have deposit services.
The deposit service would help its customers by providing the clients with a savings facility that is both secured and has a high rate of return. This would allow the customers to have a better financial cushion that they could use to bridge their liquidity gap as well as meet their needs. Going forward, the deposit products also act as a risk mitigation tool for the loan portfolio as people who save with Proximity Finance would be less likely to default.