RURAL FINANCE PROJECT

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The objective of the Rural Finance Project is to develop and test a cooperative rural banking system that would efficiently provide financial services to small private farmers and rural entrepreneurs. The project consists of four components. The first component will provide technical assistance and training to develop Savings and Credit Associations (SCAs) in the rural areas of Moldova. The second component is the establishment of regulatory body of the SCAs, which will provide technical assistance and training to the Rural Finance Project Implementation Unit to temporarily supervise and regulate SCAs, develop the framework for a permanent regulatory body of SCAs, and finance year-end audits of SCAs established under the project. The third component is the establishment of the Rural Finance Corporation (RFC), which will operate according to agreed prudential rules and an agreed policy manual, specifying RFC's lending polices. The fourth component will provide a credit line to RFC, who in turn will extend loans exclusively to SCAs operating in the rural areas.