The flow of domestic financing for microcredit organisations is on the rise lessening their dependence on overseas funds, officials said.
Micro-finance institutions (MFIs) are mainly dependent on clients' savings, bank loans and funds from the state-run Palli Karma-Sahayak Foundation (PKSF) and other such sources, they added.
The MFIs also get foreign funds for running different socio-economic developmental and service-oriented programmes, they explained.
Nearly 70 per cent of MFI funds come from their income surpluses and savings of their members, according to the Microcredit Regulatory Authority (MRA).
The current trend might lead to the sector's expansion, said a concept paper of the MRA, the country's central body monitoring and supervising microfinance operations of non-government organisation (NGO) MFIs.
As of September 03 last, the number of MFIs across the country that have registered with the MRA stood at 705 while 124 got licences on a temporary basis.
The microcredit disbursement by registered MFIs stood at Tk 782 billion by the end of June 2016 with a growth rate of 24 per cent from that of the previous year.
Experts said the MFIs get a negligible amount of donor funds each year to run various selective programmes in different parts of the country. So, the MFI operations will not be affected, if the inflow of donor funds slows, they explained.
Bangladesh's MFIs received Tk 5.10 billion from the donors at the end of June 2016.
It was Tk 7.10 billion in June 2013, Tk 6.85 billion in June 2014 and Tk 5.21 billion in 2015, according to the MRA annual report.
"The sector is broadly financed by clients' savings, cumulative surplus (profit), concessional loan received from sources such as PKSF, local and foreign grants and bank borrowing," the report said.
