news - The river of microfinance

2013 Annual Conference and General Assembly

from 15/10/2013 to 18/10/2013

Addis Ababa, Ethiopia

The Africa Microfinance Network (AFMIN) will organize its 12th Annual Conference and General Assembly at African Union Conference Center, Addis Ababa, Ethiopia on...

Discover job opportunities available and their contacts
Click here
More links
More links
The river of microfinance
January 24, 2012

ACP/EU MICROFINANCE LETTRE NEWSLETTER #2 | JANUARY 2012 - Microfinance is like a river. A river that flows within its banks provides life and livelihoods to all the communities it passes through. But a river that overflows
its banks can leave destruction and devastation in its wake.

Last year microfinance institutions reached 137.5 million of the world’s poorest families, according to the reports submitted to the Microcredit Summit Campaign. The number of clients reached has grown steadily since 1997, when
microfinance institutions reported reaching 7.6 million of world’s poorest. What started as a small stream in the 1970s has now turned into a mighty river.

Yet we have also seen the river overrun its banks in some places. Markets in Bosnia, Pakistan and Morocco have both gone through repayment crises fueled by rapid growth of MFIs, market saturation and the erosion of lending disciplines.
Last year in Andhra Pradesh over-lending and harsh collection practices led to strict controls from the state government that have virtually closed the microfinance
market in that state, collapsing a source of finance for more than 6 million families.

A strong river needs firm banks that can control the force of the flow. At the Microcredit Summit we share ACP/EU MICROFINANCE’s concerns and have joined the Smart Campaign Principles for Client Protection and are working
with the Social Performance Task Force to develop universal standards for socialperformance. We are also working with others to develop the Seal of Excellence
for Poverty Outreach and Transformation in Microfinance. Working together on these initiatives we can build strong banks for the river of microfinance, harnessing
its power in ways that enable millions of families to lift themselves out of poverty.

Larry Reed
Director, Microcredit Summit

OTHER NEWS