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Microfinance is the provision of small-scale financial services such as credit, savings and insurance to the poor. The poor need these services to invest in their livelihoods, respond to unforeseen demands and plan for their future.

In developing countries there are few jobs. The majority of the working-age population make their living through self-employment or a family business. The poor often lack even the small amount of capital necessary to buy, for example, a vegetable stall in the market or a sewing machine to make clothes to sell.

Since the poor have no steady income and own no property, they have no access to financial services to help them get started. Microfinance fills that need.

Microfinance differs from other development assistance because it empowers the poor rather than making them dependent upon charity. It enables beneficiaries to take responsibility for
their lives by employing themselves, saving for their
future, and investing according to their own priorities.

Links to Microfinance Sites

■General information on microfinance

■Microfinance rating and training


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