IDEAS home Printed from https://ideas.repec.org/a/wly/jintdv/v8y1996i2p259-269.html
   My bibliography  Save this article

Questioning the future of NGOs in microfinance

Author

Listed:
  • Thomas W. Dichter

    (Conway, MA, USA)

Abstract

A large number of NGOs are now involved in microfinance and more are making the move towards it; some even converting their finance operations to banks. This paper examines some of the motivations for this change and raises questions about the trade offs involved. The paper suggests that when credit systems air to be financially sustainable there is a strong bias to engage in credit only. The trade-offs involved have consequences not only for the soul of many NGOs (the tension between the imagery of compassion and that of capitalism) but in terms of outreach to the very poor, and in terms of impact and effect on the recipients. Credit-only approaches which adhere to sustainability criteria often miss the very poor. And as for those who are reached by micro loans, without other inputs than credit, many of these borrowers have difficulty making productive use of the loans; the result of lack of absorptive capacity, lack of confidence, lack of knowledge. NGOs who shift into sustainable credit programs may be losing their real competitive advantage in the world of development-their capacity to reach the very poorest and engage in a variety of activities that help people change, but which cannot necessarily be financially supported by the recipient of the assistance.

Suggested Citation

  • Thomas W. Dichter, 1996. "Questioning the future of NGOs in microfinance," Journal of International Development, John Wiley & Sons, Ltd., vol. 8(2), pages 259-269.
  • Handle: RePEc:wly:jintdv:v:8:y:1996:i:2:p:259-269
    DOI: 10.1002/(SICI)1099-1328(199603)8:2<259::AID-JID377>3.0.CO;2-7
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Widiarto, Indra & Emrouznejad, Ali, 2015. "Social and financial efficiency of Islamic microfinance institutions: A Data Envelopment Analysis application," Socio-Economic Planning Sciences, Elsevier, vol. 50(C), pages 1-17.
    2. Isabelle Guérin, 2000. "Microfinance dans les pays du Sud : quelle compatibilité entre solidarité et pérennité," Revue d'Économie Financière, Programme National Persée, vol. 56(1), pages 145-164.
    3. Ashfaq Ahmad Khan & Wiqar Ahmad, 2013. "Matching resources with demand: a flawed strategy?," Asia-Pacific Development Journal, United Nations Economic and Social Commission for Asia and the Pacific (ESCAP), vol. 20(1), pages 63-89, June.
    4. repec:pal:jorsoc:v:60:y:2009:i:1:d:10.1057_palgrave.jors.2602527 is not listed on IDEAS
    5. Bashir, Rabia & Bajwa, Sami & Mamoon, Dawood, 2017. "Channeling Local Culture into Sustainable Microfinance Solutions by Akhuwat: From Borrowers to Donors," MPRA Paper 81591, University Library of Munich, Germany.
    6. Mitlin, Diana & Hickey, Sam & Bebbington, Anthony, 2007. "Reclaiming Development? NGOs and the Challenge of Alternatives," World Development, Elsevier, vol. 35(10), pages 1699-1720, October.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wly:jintdv:v:8:y:1996:i:2:p:259-269. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Wiley-Blackwell Digital Licensing) or (Christopher F. Baum). General contact details of provider: http://www3.interscience.wiley.com/journal/5102/home .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.