Paris Microfinance Network

What is Microfinance?

What is Microfinance & Microcredit? - How does it work? - What is an MFI? - Impact & Statistics

Microfinance Impact & Statistics

In most developing countries the majority of borrowers are women. 70% of the world’s poor are women. Women also have a higher unemployment rate than men in virtually every country & also comprise the majority of the informal sector of most economies. They constitute the bulk of those who need microfinance services.

These women are using the money to either start their own home or market based business or grow an existing business. In turn they primarily use the money to both advance their business & nurture their domestic lives. They advance their households by sending children to school, paying medical expenses, maintaining a home, paying basic energy or transportation expenses, etc. - many things taken for granted in the western world. Women are usually the primary or sole family caretakers in many developing countries. Putting extra income in women’s hands is often the most efficient way to affect an entire family, as women typically put their children’s needs before their own. Children are more likely to complete their education and escape the poverty trap their parents lived, benefiting future generations.

Hence, women have become a primary market for many microcredit institutions and agencies worldwide since they tend to benefit the entire family & local societies. It has also been observed that giving women the control and the responsibility of small loans raises their socio-economic status, which is seen as a positive change to many of the current relationships of gender and class. Research performed by the United Nations Development Programme (UNDP) and the World Bank, among others, indicates that gender inequalities inhibit overall economic growth and development. A recent World Bank report confirms that societies that discriminate on the basis of gender pay the cost of greater poverty, slower economic growth, weaker governance, and a lower living standard for all people.

The Microcredit Summit Campaign has published extensive results & findings - here some important statistics about MFI programs in various regions :

The growth from 66.6 million poorest clients at the end of 2004 to 81.9 million poorest clients at the end of 2005 represents a 23 percent growth rate over the year. The growth from 7.6 million poorest at the end of 1997 to 81.9 million poorest at the end of 2005 represents a growth of 978 percent during that eight-year period.

In order to reach 100 million poorest by the end of 2005, the Campaign needed to sustain a growth rate of 38.1 percent per year. The growth rate averaged just over 34 percent per year. If the growth of 15.3 million poorest clients over the last year continues, the Campaign’s goal of reaching 100 million of the world’s poorest families will be met in the beginning of 2007.

Of the 81.9 million poorest clients reached at the end of 2005, 84.2 percent or 69 million are women. The growth in the number of very poor women reached has gone from 10.3 million at the end of 1999 to 69 million at the end of 2005.

This is a 570 percent increase in the number of poorest women reached from December 31, 1999 to December 31, 2005. The increase represents an additional 58.7 million poorest women receiving microloans in the last six years. in the last six years.

Client stories :

Oyunchimeg Dendev in Mongolia - client of Xacbank & Women's World Bank

Maria “Ester” Gonzalez de Altamirano in Buenos Aires - client of FIS & Unitus

FINCA clients in Africa

Bulgarian Potato Farmer COOP helped by OikoCredit