USAID/Kyiv, 19 Nyzhniy Val St., 254071 Kiev, Ukraine

R -- UKRAINE CREDIT UNION PROGRAM SOL USAID/Kyiv RFA 0002 DUE 053100 POC Winifred Mulligan, E-mail: wmulligan@usaid.gov, Tel: 380-44-462-5678, Contracting Officer, Catherine A. Mallay, E-mail: cmallay@usaid.gov WEB: http://www.info.usaid.gov/procurement_bus_opp/procurement/announce/cbd, http://www.info.usaid.gov. E-MAIL: http://www.info.usaid.gov, wmulligan@usaid.gov or cmallay@usaid.gov. USAID/Kiev intends to issue a request for grant applications (RFA) for a credit by approximately 30 April 2000, for a credit union activity. The RFA will be issued/posted on USAID's agency website: www.info.usaid.gov, under the section on business and procurement. Background information follows. Over the past four years, a USAID/Kiev grant has supported the development of credit unions in Ukraine. The program assisted in the development of eleven model credit unions and in the development of the Ukrainian National Association of Savings and Credit Unions (UNASCU). The assistance to UNASCU focused on institutional support and improving the legal framework for the development of Ukrainian credit unions. The Canadian assistance program has also supported the development of credit unions in Ukraine through a similar approach, but in different geographical areas. A unique aspect of the USAID program was to provide support to Ukrainian credit union staff to spend internships at Ukrainian-American credit unions in the United States. An association of Ukrainian-American Credit Unions has also shown substantial interest in assisting Ukrainian credit unions and has held annual meetings in Ukraine to promote and lobby the GOU for the Ukrainian credit union movement. A similar association of Ukrainian-Canadian Credit Unions is a partner in the Canadian technical assistance program to credit unions. USAID/Kiev views the development of a strong credit union system in Ukraine as important to the development of Ukraine's financial system. Credit unions are currently responsible for more savings mobilization and credit among poorer Ukrainians than any other type of formal financial institution in Ukraine in areas where credit unions operate. USAID/Kiev is interested in the development of the credit union system both to improve access to micro and small enterprise finance and to deepen the financial system in Ukraine. However, more information on credit unions is needed for USAID to be able to better target the assistance required at this stage of the development of credit unions in Ukraine and to assure that the USAID program does not duplicate programs of other donors. The USAID grant described above ended in September 1999. USAID/Kiev staff conducted a rapid appraisal of the program in November 1999 to better understand the operations of the model credit unions assisted. Among the seven model credit unions visited in East and Central Ukraine, USAID found that one was bankrupt and two appeared to be close to bankruptcy. The others ranged from mildly achieving solvency to being fully solvent with little or no bad credit. Many of the credit union officials interviewed raised issues concerning the effectiveness of national associations of credit unions. USAID/Kiev's survey of the model credit unions was very limited. There are over 400 credit unions in Ukraine and a more representative sample by an independent consultant on the operations, successes, and issues facing credit unions is warranted prior to the next commitment of USAID funding. USAID/Kiev plans to conduct such an assessment in early 2000. Based on the findings and recommendations of this assessment, USAID plans to target future support to credit unions under an RFA that would be issued on or about 30 April 2000. Posted 01/24/00 (W-SN418072). (0024)

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