Archived Current Discussions
The Securitization of Microfinance Assets. Over the last several decades securitizations have become an increasingly conspicuous part of the international financial marketplace. (See the U.S. mortgage market.) A securitization is essentially a bundled group of assets…Read more…..
From Microfinance to Livelihoods. Microfinance has been used as a tool to alleviate poverty for over 30 years. Its principal mechanism to meet that objective has been microcredit. However, recent studies have shown that microcredit is insufficient to tackle poverty and that the poor also need a range of financial services for their economic empowerment, resulting in microfinance. Read more….
Roland Dominice speaks about Microfinance Investment Vehicles (MIVs). Microfinance Investment Vehicles (MIVs) play a key role as a source of capital to fund microfinance institutions globally. There are currently 102 MIVs with total assets of $6.5 billion and growing. Read more.…
Living on US$2 a Day. The World Bank and the United Nations use internationally defined poverty as living on less than US$2 a day on average, and they note that below this amount most individuals can’t afford basics such as food and shelter or even access to drinking water. Read more…. An additional experiment by students to fight global poverty.
Matched Microsavings: A tool for economic development? Individual development accounts (or IDAs) are micro-savings programs aimed at encouraging financial literacy and asset-building amongst low income households. Used by over 20,000 individuals in the U.S., these programs typically partner with local banks, credit unions and non-profits to “match” deposits made by individuals to reach certain asset-building goals. To encourage savings, a sponsoring institution typically matches savings on a 1:1 or 2:1 basis (so that $10 saved results in a $20 or $30 savings account). Read more..…
Some highlights from the David Roodman and Milford Bateman Debate on Microfinance. AboutMicrofinance participated in the January 30, 2012 webinar debate “Moving Financial Inclusion Beyond Microfinance”, between David Roodman (Center for Global Development) and Milford Bateman, (University of Juraj Dobrila Pula) with Chuck Waterfield (Transparency) moderating. The debate, hosted by USAID’s Microlinks and FIFO, focused on addressing: If microfinance hasn’t achieved its objective in substantially reducing poverty, what are the pathways to financial inclusion that will contribute to this objective? Read more…. Plus additional highlights from the Center for Financial Inclusion.
Microfranchising: An Innovative Approach in Microfinance. Over the past decade or so microfranchising has emerged as a new and exciting addition to the microfinancial toolkit. Like microcredit, microfranchising involves the utilization of credit to enhance emerging market economic opportunity and growth. Unlike microcredit, it relies on the utilization of a dynamic akin to that of a franchising system found in developed markets, albeit with an NGO or development bank acting as the parent institution. Read more… and watch videos Video on SELCO, Video on Ikotoilet, Video on Village Phone.
The Use of Randomized Evaluations in Microfinance. As the microfinance industry continues to expand, and innovations in lending methods and financial product offerings continue to emerge, the need for sophisticated program evaluation tools has become increasingly apparent. Read more….
Report from the 2011 Global Microcredit Summit, Valladolid, Spain. Attending the Summit, Clara Lipson, Founder& Executive Director AboutMicrofinance.com was one of more than 1,800 delegates from 104 countries. Read about day 1 of the Summit.…
Global Microcredit Summit: Some highlights – Day 2. Covering the Summit, AboutMicrofinance highlights topics ranging from client protection to transparency and governance issues. Read more….
Student Essay. Announcing the winner of the first AboutMicrofinance student competition, “Making microfinance institutions sustainable – challenges and opportunities”. Read more….
The Impact of MIS on Microfinance Institutions. Management information systems (MIS) have played a key role in the traditional banking sector for years, but microfinance institutions have been much slower to utilize this technology, primarily due to budgeting shortfalls. What are some options and solutions available to MFIs? Read more…..
Microfinance Institutions and the Remittances Market. AboutMicrofinance learned that in 2010, migrants sent back home $325 billion in recorded remittances. Additionally, diaspora communities hold sizeable financial assets sometimes used to make investments in their country of origin. How does this affect microfinance? Read more……
Micro-initiatives for Microfinance – Is this a Movement? Traditional microfinance has largely been funded by large institutional supporters … but over the over the past several years, a variety of grassroots initiatives have emerged which help augment traditional funding streams by tapping into donations and other support from large groups of ordinary individuals. Read more…
Has the Global Financial Crisis Impacted Microfinance? At the start of the global financial crisis in 2007, the World Bank questioned the impact of the crisis on microfinance institutions and their clients. A recent study by the International Monetary Fund (IMF) methodically examined the data and tracked the impact of the financial crisis on the microfinance sector. Read more….
Can Microfinance Serve Youth? As microfinance develops into a viable sector, numerous innovations as well as products and services are offered to clients. A growing focus of microfinance is on youth, variably defined as those aged 12-24. Read about important youth initiatives……
Islamic Banking and Microfinance. The nexus between Islamic banking and microfinance has been previously discussed, addressing interest free lending while promoting fairness and ethical practices in accordance with Islamic law. The subject of Islamic banking and microfinance was recently addressed in an online “Discussion Corner” organized by USAID. Read more….
Microfinance and Risk Management. Banks and financial institutions globally have to comply with a wide range of regulations in accordance with stated standards. Financial and operational risk management is at the core of risk management policy and controls, which are needed to ensure a margin of safety and avoid insolvency. What is it about microfinance institutions that has, for the most part, excluded them from adopting risk management controls and regulations? Read more….
Microfinance in Transition? As microfinance has been evolving over the past 30 years, it has invariably been referred to as a program, a sector, an industry and an alternative asset class. But some experts are now questioning whether microfinance may become a subsector of Impact Investing. Read more ….
Microfinance USA 2011. AboutMicrofinance participated in a 2-day conference in New York organized by Accion, US Network, Opportunity Fund and Kiva, which offered a forum for investors, policymakers, academics, and practitioners engaged in best practices. Issues confronting microfinance today were addressed in a panel on “Balancing Act: Mission, Profit, and Impact on Microfinance”. Read more .….
Financial Services for the Poor. At the outset, financial services for poor households consisted of small loans to individuals organized as peer groups with cross-guarantees. The focus was on microcredit. Now, access to a variety of financial services to the poor is taking hold. Read more….
Does Microfinance Reduce Poverty – Or Not? Roughly 3 billion people in the world live below the poverty line — on less than $2 a day. Microfinance has been portrayed as a “bottom-up economic solution” using policy and program intervention mechanisms. Read more….