Microfinance: Difference between revisions
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'''Microfinance''' is a system of providing small loans (under $200) in poor countries to promote entrepreneurship. It began with local initiatives in Latin America and South Asia in the 1970s. By 2006 some 65 million entrepreneurs around the world have received receive small loans without collateral. Major international organizations and philanthropies, such as the World Bank, have begun funding. The lenders (Micro Finance Institutions or MFI) usually provide basic training in necessary business skills. The Grameen Bank of Bangladesh, which was founded by 2006 Nobel Peace Laureate Dr. Muhammad Yunus, is the world’s largest and most successful MFI. It serves more than seven million clients. | '''Microfinance''' is a system of providing '''microcredit''', that is small loans (under $200) in poor countries to promote entrepreneurship. It began with local initiatives in Latin America and South Asia in the 1970s. By 2006 some 65 million entrepreneurs around the world have received receive small loans without collateral. Major international organizations and philanthropies, such as the World Bank, have begun funding. The lenders (Micro Finance Institutions or MFI) usually provide basic training in necessary business skills and set up peer support networks. The MFI interest rates range from 18% to 60% per year, well below the rates of local “money lenders,” who regularly charge between 120% and 300%. | ||
The Grameen Bank of Bangladesh, which was founded by 2006 Nobel Peace Laureate Dr. Muhammad Yunus, is the world’s largest and most successful MFI. It serves more than seven million clients. | |||
==External links== | ==External links== | ||
* [http://wbln0018.worldbank.org/networks/fpsi/rmfsme.nsf/ World Bank program] | * [http://wbln0018.worldbank.org/networks/fpsi/rmfsme.nsf/ World Bank program] | ||
Revision as of 15:03, 8 December 2007
Microfinance is a system of providing microcredit, that is small loans (under $200) in poor countries to promote entrepreneurship. It began with local initiatives in Latin America and South Asia in the 1970s. By 2006 some 65 million entrepreneurs around the world have received receive small loans without collateral. Major international organizations and philanthropies, such as the World Bank, have begun funding. The lenders (Micro Finance Institutions or MFI) usually provide basic training in necessary business skills and set up peer support networks. The MFI interest rates range from 18% to 60% per year, well below the rates of local “money lenders,” who regularly charge between 120% and 300%.
The Grameen Bank of Bangladesh, which was founded by 2006 Nobel Peace Laureate Dr. Muhammad Yunus, is the world’s largest and most successful MFI. It serves more than seven million clients.
External links
Bibliography
- Armendáriz, Beatriz, and Jonathan Morduch. The Economics of Microfinance (2007) excerpt and text search
- Robinson, Marguerite S. Microfinance Revolution: The Emerging Industry (2 vol 2005)