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Quality microfinance : successful clients and institutions
Document type: article
Download file(s):
188455 (860 KB)
Abstract:
This paper assesses the best ways of dealing with the current financial crisis and balancing people needs. The author claims that microfinance institutions (MFIs) should act to ensure both quality and responsible lending, and their main focus is responding to clients’ needs. Microfinance is not only about lending and collecting money back, but is a practice with an added social value. There should be an increasing awareness in MFIs of the need for a socially targeted service, which includes both positive social and economic goals. A successful MFI is one that ensures quality and responsible lending to people in need of financial aid. There is an estimated 2.5 billion with no access to basic financial services. The financial crisis and the recession in the turn of the century are revealing the inadequacy of the system and the need for changes towards more responsible lending policies and practices. The client’s ability to repay a loan should be supported by institutions tailored to their needs. Instead of pushing for competition and high rates, the MFIs should focus more on building a reliable relationship between the client and the institution. The core advice is for client protection to be implemented.
Authors:
Simanowitz, A.
Category:
General
End Page:
6
Serial number:
2
ISSN:
[2210-2175]
Volume:
I
Journal:
Spanda Journal : quarterly of the Spanda Foundation
Keywords:
credit
,
finance
,
markets
,
poverty
Language:
eng
Organization:
Spanda Foundation
Year:
2010
Right:
© 2010 Spanda Foundation
Subject:
Economic Development and Trade
Start Page:
4
Title:
Quality microfinance : successful clients and institutions