Presentation on theme: "ECON 465 March 5, 2009 Catherine Nguyen Samuel Oh."— Presentation transcript:
ECON 465 March 5, 2009 Catherine Nguyen Samuel Oh
What is microfinance? Origins Institutions Jobs Benefits Examples Current Conditions Future Prospects Concerns
Microfinance is defined as financial services for poor and low-income clients. Microfinance is a movement that will help low income families have access to financial institutions.
Microfinance clients are poor and have low- incomes. Microfinance clients tend to be below the poverty line. Many households are without financial access.
Most microfinance intuitions started as not-for-profit organizations.
ACCION Communitaria del Peru (ACP) ACODEP, Nicaragua ACTUAR/Tolima, Colombia ADMIC National, A.C., Mexico Agencia de Desarollo Economico Local de Morazan, El Salvador Asociacion Benefica PRISMA, Peru Asociacion de Mujeres Campesinas Salvadorenas, El Salvador
Microfinance can provide a range of benefits that poor households highly value. Microcredit improves lives. Other microfinance services include…
Report from Economist Intelligence Unit, Oct Overall portfolio value increase since 2001: from $1.19 bn to $9.25 bn. 34% growth/year.
Bright in current financial markets. Typical repayment rates are 95-98%. Not a solution to poverty.
CompartamosBanco listed its shares for $1+ bn in Legal Loan Shark? Average interest rates 79%+. Exploiting the financial ignorance of customers?
Allowing open market to meet needs. Microfinancing is labor-intensive. Entice competitors and lower interest rates (115% seven years ago). Financial Literacy courses to clients.