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Microcredit for self-employed disabled persons in developing countries


  • Mersland, Roy


Microcredit has become a popular instrument to promote economic empowerment among poor entrepreneurs, and is increasingly being recommended to improve economic rehabilitation among persons with disabilities. However, the majority of the advocates of microcredit for persons with disabilities seem not to be informed on the involved “rules of the game”. At the same time the microfinance community lacks information on disability issues. In this report we aim on closing the gap in knowledge and culture between the disability- and the microfinance communities. We apply resource based theory to analyze when microcredit for disabled persons is an appropriate tool and when it is not. We argue that asymmetric information between microfinance institutions and the disabled population is probably the main hindrance for increased penetration of microcredit services to disabled persons. We recommend disabled entrepreneurs with the necesarry resource base to be included as regular clients in mainstream MFIs or as regular members in self helping microfinance systems like ROSCAs. We provide lists of recommendations that are both easy to understand and to apply for MFIs, DPOs and donors. Due to the lack of theoretical and empirical knowledge available we see this report as a starting point and we advocate for increased research efforts within this field.

Suggested Citation

  • Mersland, Roy, 2005. "Microcredit for self-employed disabled persons in developing countries," MPRA Paper 2068, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:2068

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    References listed on IDEAS

    1. Imran Matin & David Hulme & Stuart Rutherford, 2002. "Finance for the poor: from microcredit to microfinancial services," Journal of International Development, John Wiley & Sons, Ltd., vol. 14(2), pages 273-294.
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    4. Elwan, Ann, 1999. "Poverty and disability : a survey of the literature," Social Protection and Labor Policy and Technical Notes 21315, The World Bank.
    5. Bouman, F. J. A., 1995. "Rotating and accumulating savings and credit associations: A development perspective," World Development, Elsevier, vol. 23(3), pages 371-384, March.
    6. Alter, George & Goldin, Claudia & Rotella, Elyce, 1994. "The Savings of Ordinary Americans: The Philadelphia Saving Fund Society in the Mid-Nineteenth Century," The Journal of Economic History, Cambridge University Press, vol. 54(04), pages 735-767, December.
    7. Cooper, Arnold C., 1993. "Challenges in predicting new firm performance," Journal of Business Venturing, Elsevier, vol. 8(3), pages 241-253, May.
    8. Beatriz Armendariz & Jonathan Morduch, 2007. "The Economics of Microfinance," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262512017, January.
    9. Shepherd, Dean A. & Douglas, Evan J. & Shanley, Mark, 2000. "New venture survival: Ignorance, external shocks, and risk reduction strategies," Journal of Business Venturing, Elsevier, vol. 15(5-6), pages 393-410.
    10. Morduch, Jonathan, 1999. "The role of subsidies in microfinance: evidence from the Grameen Bank," Journal of Development Economics, Elsevier, vol. 60(1), pages 229-248, October.
    11. Hoang, Ha & Antoncic, Bostjan, 2003. "Network-based research in entrepreneurship: A critical review," Journal of Business Venturing, Elsevier, vol. 18(2), pages 165-187, March.
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    More about this item


    Microfinance; disability; MFIs; donors; DPOs;

    JEL classification:

    • I00 - Health, Education, and Welfare - - General - - - General
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration


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