Rural Financial Markets in Asia: Paradigms, Policies and Performance
Nagarajan, G. & Meyer, R. L.
Publication Date: 2000
Published by: Asian Development Bank (ADB)
Document Type: Book
Understanding rural financial markets in Asia and readying them for the 21st century
This book traces the growth and development of rural financial markets in Asia since 1978, and presents an overview of the current scenario. The paper, which is derived from existing literature, specially focuses on:
- Provision and use of financial services in Asia's rural economy;
- Relationship between the transformation of the rural economy and the rural financial system.
The book summarizes the nature of the economic transformation that has occurred in Asia since the 1970s:
- Explains the structural changes that occurred in the rural economy,
- Identifies the opportunities and challenges that these changes present for rural financial markets,
- Provides an in depth conceptual framework to analyze financial markets,
- Offers costs and risks of providing rural financial services.
- Details approaches that the governments took to rural finance in the 1970s and 1980s.
The paper identifies the problems identified with governments' approaches, and the resulting shift from the old directed-credit approach to the new market-oriented approach and focuses on:
- Creating the policy environment,
- Building financial infrastructure,
- Institutional development.
The book discusses why directed credit may have made a more positive contribution in some Asian countries than elsewhere, and describes the following in detail:
- Key policy areas that demand attention,
- Financial infrastructure that is weak or missing,
- Need for institutional development, especially regarding failing institutions and microfinance organizations.
The book also presents in depth studies of rural financial markets in India, Bangladesh, China, Indonesia, Kyrgyz Republic and Thailand.
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