Lending opportunities spotted in emerging Asia

Jonathan Boyd

Value Partners, the global consulting firm founded in Milan in 1993, has published research into the size of the lending market available to financial institutions targeting self employed entrepreneurs in emerging Asia markets such as Vietnam, the Philippines, Bangladesh, Myanmar (Burma), as well as in the larger market that is India.

The focus within the entrepreneur community is further refined to the so called micro entrepreneurs, those that fall betweeen microfinancing and standard bank lending activities.  According to the research paper authors – Mayank Parekh, director Singapore Office, Stefano Sorrentino, senior engagement manager Hong Kong Office, and Julian Antony, associate Singapore Office – the markets are substantial: India alone represents a $140bn opportunity, with each of the other markets mentioned offering a gap in funding of some $8bn.

“Amongst the 5 markets evaluated, the Philippines presents the most broad-based market opportunity given its conducive regulatory environment and nascent competitive landscape for this segment, in contrast to Myanmar, where evolution in the regulatory context and an alternative operating model is required to achieve profitability,” the authors conclude.

“India and Bangladesh also present attractive opportunities, although they may be more sub-regional in focus and require more attractive product terms (such as lower interest rates), while the Vietnam opportunity lies in attacking geographies with low SOE coverage and possibly offering longer duration loans to avoid interest rate caps.”

To read the full research click here: Value_Partners_Research_Asia