Microfinance  

Microcredit

"The lending of small sums of money on very low security, especially to small businesses or to small producers in the developing world.

(From Oxford's A Dictionary of Finance and Banking)

Microfinance

“Microfinance” is often defined as financial services for poor and low-income clients. In practice, the term is often used more narrowly to refer to loans and other services from providers that identify themselves as “microfinance institutions” (MFIs). These institutions commonly tend to use new methods developed over the last 30 years to deliver very small loans to unsalaried borrowers, taking little or no collateral. These methods include group lending and liability, pre-loan savings requirements, gradually increasing loan sizes, and an implicit guarantee of ready access to future loans if present loans are repaid fully and promptly.

More broadly, microfinance refers to a movement that envisions a world in which low-income households have permanent access to a range of high quality financial services to finance their income-producing activities, build assets, stabilize consumption, and protect against risks. These services are not limited to credit, but include savings, insurance, and money transfers."

(From Consultive Group to Assist the Poor [CGAP] Microfinance Gateway)

Microfinance Study Guides

Click the links to read the CQ Researcher Evalulating Microfinance report or the Proquest / CSA study guide titled: The Promise of Microfinance for Poverty Relief in the Developing World by Matthew Ruben.