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LECTURE  INTRODUCTION TO MICROFINANCE  May 6th, 2009 Emilie Levy,  Executive Director
DEFINITION OF MICROFINANCE STAKEHOLDERS MICROFINANCE BEST PRACTICES SUSTAINABILITY AND RISKS SNAPSHOT OF MICROFINANCE TODAY Agenda
[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Case study
[object Object],Justification and definition of microfinance ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Justification and definition of microfinance FINANCE  MICRO ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
[object Object],[object Object],[object Object],[object Object],[object Object],Definition Microfinance is the offer of financial & non-financial services to people  excluded  from the traditional banking system. The services are  adapted  to the needs of the target populations
[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Introduction to Microfinance: History Yunus’ idea Prof. Muhammed Yunus   Founder of the Grameen Bank, Bangladesh
MICROFINANCE INSTITUTIONS (MFIs) (NGO, ASSOCIATIONS & BANKS) Commercial Banks COMMERCIAL BANKS & INVESTMENT FUNDS FOUNDATIONS & DONORS (incl. enterprises) GOVERNMENT & LOCAL BODIES SUPPORT ORANIZATIONS  (e.g. PF) BENEFICIARIES Actors & Mechanisms
Regular contact and follow up between the MFI and the client Micro-credit Best practices (1/4 ): microcredit  Mrs. Israel needs NIS 1,000 4   Final Repayment 12 weeks later Demand for a 2 nd  loan over  NIS 1500 to buy a fridge) 2   Purchase of the ingredients Start of cooking & sale (Daily benefits amount NIS 100) 1  Visit of  Mrs. Israel to the MFI Meeting wit the Loan Officer Convinced, reception of a loan of NIS 1,000 (+ NIS 30 interest rate ) 3   Weekly Repayment  ( 86 NIS) Remaining money is used to buy food
[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Microcredit Best Practice (2/4 ) Repayment
[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Micro-credit Best practices (3/4 ): Interest Rate
[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Microcredit Best practices (4/4): Key success factors
Sustainability: the conceptual framework OUTREACH IMPACT How do we measure the impact? SUSTAINABILITY Why few MFIs are  sustainable ? ,[object Object],[object Object]
[object Object],[object Object],[object Object],[object Object],[object Object],Sources : CGAP, BIT, Microcredit Summit, PlaNet Finance Microfinance in the world today
[object Object],[object Object],[object Object],New trends
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Emilie levy

  • 1. LECTURE INTRODUCTION TO MICROFINANCE May 6th, 2009 Emilie Levy, Executive Director
  • 2. DEFINITION OF MICROFINANCE STAKEHOLDERS MICROFINANCE BEST PRACTICES SUSTAINABILITY AND RISKS SNAPSHOT OF MICROFINANCE TODAY Agenda
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  • 8. MICROFINANCE INSTITUTIONS (MFIs) (NGO, ASSOCIATIONS & BANKS) Commercial Banks COMMERCIAL BANKS & INVESTMENT FUNDS FOUNDATIONS & DONORS (incl. enterprises) GOVERNMENT & LOCAL BODIES SUPPORT ORANIZATIONS (e.g. PF) BENEFICIARIES Actors & Mechanisms
  • 9. Regular contact and follow up between the MFI and the client Micro-credit Best practices (1/4 ): microcredit Mrs. Israel needs NIS 1,000 4 Final Repayment 12 weeks later Demand for a 2 nd loan over NIS 1500 to buy a fridge) 2 Purchase of the ingredients Start of cooking & sale (Daily benefits amount NIS 100) 1 Visit of Mrs. Israel to the MFI Meeting wit the Loan Officer Convinced, reception of a loan of NIS 1,000 (+ NIS 30 interest rate ) 3 Weekly Repayment ( 86 NIS) Remaining money is used to buy food
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