Russia

Economy:
While the Russian economy has grown steadily since 1998, thanks primarily to high oil prices, this growth has been concentrated in Moscow and St. Petersburg. Large segments of the regional and rural population have not benefited from the expanding economy. Poverty has declined but 17.8 percent of the Russian population-more than 25 million people-live below the poverty line.

Unemployment is at 7.6 percent and there is considerable underemployment. Some 68.3 percent of the Russian labor force of 74.2 million works in services, 21.4 percent works in the decrepit manufacturing base, and 10.3 percent is in agriculture. Much of Russia lacks proper soils and climates (either too cold or too dry) for agriculture. Like other countries in the Former Soviet Union, Russia faces severe environmental problems.

Climate for microfinance:
• Russia has made little progress in building the rule of law, the bedrock of a modern market economy.
• Russia has a weak banking system, a poor business climate that discourages investment, corruption, and widespread lack of trust in institutions like banks.
• Russia is "under-banked" for a country of its size and population.
• Poor and rural people have very limited access to financial services; commercial banks tend to focus on businesses and wealthier individuals in urban areas.

FINCA Russia serves clients in more than 40 cities, towns and villages in the Samara, Ulianovsk, and Orenburg oblasts in the Volga region of Russia, and in the Tomsk, Novosibirsk and Krasnoyarsk regions of central Siberia. In late 2006 FINCA began operations in Kazan in the Volga-region Republic of Tatarstan. The company's Russian headquarters is in the city of Samara in the Samara oblast, which is located 1,000 km southeast of Moscow on the Volga River.