We think of microfinance as being ‘invented’ in Bangladesh in the 1970s. To be sure, Grameen was the genesis of modern microcredit, the provision of small, unsecured loans to mostly women, for enterprise development. But microfinance – defined more broadly as financial services to the poor – goes back as far as money and commerce.
I am not a regular blogger (does the noun exist ? It sounds slightly inappropriate) but I have succumbed to an invitation to share some hasty and ill-considered thoughts with a wider readership than myself. And, as is often the case, the subject is microfinance; I know quite a lot about it, if knowing means writing books about it, criticising it, directing and rating it, but like just about everyone who reads this note, I have never actually used it.
Since the microfinance sector broadened its focus from loans to financial inclusion, savings have become a major focus. And rightly so – the argument for providing poor customers with a safe and reliable place is backed by both robust research and common sense. Meanwhile, MFIs are already delivering on the promise: in 2011, MIX Market reported nearly 80 million depositors world-wide, with an average balance of $994.
The 2013 European Microfinance Week will open with a debate. Dr. Aris Alip, founder of the CARD group of companies in the Philippines and Dr. Michael Chu, Professor at Harvard Business School and former director of Accion will tackle the question: What is the goal of microfinance, lifting the poor out of poverty or financial access for all?
This summer marked an important milestone in microfinance. David Roodman announced his departure from the Center for Global Development to the Gates Foundation. By doing so, David also stepped down from his role as the blogger of record for the sector. As we launch the new e-MFP blog, we look back and celebrate the most influential microfinance blog.