The New World of Microenterprise Finance: Building Healthy Financial Institutions for the Poor

Publication Date: 1994
Published by: West Hartford, Connecticut, USA: Kumarian Press
Document Type: Book

A review of contemporary challenges in the area of microenterprise finance, setting principles for future work in this field.

Major ideas in practical microfinance are systematically reviewed. The book:

• Explores the relationship of programmes and their beneficiaries, offering tips for effective and efficient management of microenterprise finance.
• Presents ideas that are crucial to the transformation of microenterprise finance and looks at techniques for providing financial services to the poor with its unprecedented positive results in scale and outreach, while building self- sufficiency
• Demonstrates that microenterprise finance has the potential to enfranchise a major part of the population highlighting the necessary ingredients and recipe for building healthy microfinancial institutions for the poor.
• Advances ideas that are remarkably different from conventional wisdom of banking which held that microenterprises were too risky and too costly for any one to serve profitably

• Viable, self-sustaining financial intermediaries can be created to serve a low income microenterprise clientele
• Banking institutions motivated by longer-term vision of the common good can be capitalised for the primary purpose of entry-level economic development. By lowering information costs through specialisation and innovation in delivery systems, they can operate profitably in markets with small transaction sizes and less affluent clients
• Poor entrepreneurs possess the same survival skills as affluent business operators. They save money, carefully apply their entrepreneurial energy, and repay debts as scheduled to maintain access to future loans
• Investment in self-sustaining institutions that finance poor residents is a comparatively cost-effective use of scarce subsidies.

• Indonesia
• Kenya
• Bolivia
• Colombia

This document is available in hard copy only. Please contact Kumarian Press for a copy