Goal 8.1: Financial institutions have dedicated service and products for the tech start-ups and e-commerce players The high risk of doing business in Myanmar has encouraged banks to lend on short terms -one year- which limits credit as a useful source of investment capital; tech start-ups are particularly affected as banks don’t understand their business models. Myanmar financial institutions and SMEs face many challenges typical of developing economies: lack of financial service sophistication and high collaterals. Increasing participation of foreign-owned banks, like in neighboring countries will spur innovation, increase competition and ease access to finance for start-ups and e-commerce firms. Goal 8.2: Micro-entrepreneurs have been financially digitalized Costs of doing business and costs of access to financial payment means and loans has remained consistently difficult in Myanmar. However, regulatory developments in the past few years has seen very promising development in the fintech industry, resulting in more electronic payment solutions offered to merchants, provided by telecom operators and non-financial payment service providers. Accelerating adoption of mobile payment, increasing digital financial literacy will increase efficiency, decrease costs of handling money and improve Myanmar’s status with anti-money laundering bodies, as transparency will increase through tracing of payments. Goal 8.3: Venture capital and risk capital are the main source of financing for e-commerce and tech start-ups Faced with multiple access to finance challenges, businesses have found partial solutions through support and investments by venture capitalist and business accelerators, that have grown rapidly. In general, early stage tech investing is moving on the right trajectory: tech start-ups successfully attracted seed funding and have therefore increasing access to larger amount of capital from a growing domestic venture capital scene. This still remains limited, not financially sustainable and happening outside Government intervention. Enhancing venture capital and risk capital will help bridge the financing gaps while commercial banks get up to speed with financing needs, by developing ICT / tech start-ups business friendly products and services. No. Indicative action Expected outputs Priority level Potential support by: Related strategies MCB, CBM, Commercial Banks, ADB MSDP Strategy 2.1 Effectively manage the exchange rate and balance of payments Goal 8.1: Financial institutions have dedicated service and products for the tech start-ups and e-commerce players 8.1.1 Improve credit information and access to the information provided by the newly founded Myanmar Credit Bureau Better and increased access to credit for tech entrepreneurs, e-commerce vendors, marketplaces. High 49