Micro finance and poverty reduction in Asia: what is the evidence?
Despite the extensive spread of micro finance, studies on the actual impact of MFIs are often more ambivalent about its impact than is the aid community. Much has been written on the range of institutional arrangements pursued in different organizations and countries and in turn a vast number studies have attempted to assess the outreach and poverty impact of such schemes. However, amongst the academic development community there is a recognition that perhaps we know much less about the impact of these programs than might be expected given the enthusiasm for these activities in donor and policy-making circles. In recognition of this uncertainty this paper aims to bring together some of the recent evidence that has been accumulating on the impact of microfinance activities on poverty reduction. In particular we ask what is the evidence on three specific issues: (1) the extent to which microfinance initiatives have made a lasting difference in pulling households out of poverty on a permanent basis; (2) the extent to which microfinance programs reach only the better-off amongst the poor, leaving the ‘core poor’ unaffected; and (3) how far micro finance is a cost-effective means of transferring income to the poor. The evidence surveyed here suggests that the conclusion from the early literature, that whilst micro finance clearly may have had positive impacts on poverty it is unlikely to be a simple panacea for reaching the core poor, remains valid. Reaching the core poor is difficult and some of the reasons that made them difficult to reach with conventional financial instruments mean that they may also be high risk and therefore unattractive microfinance clients. Hence there is a need to continually improve design and outreach and to see MFIs as part of the package for targeting the poor, rather than the whole solution.
|Date of creation:||Dec 2003|
|Date of revision:|
|Contact details of provider:|| Postal: |
Web page: http://mpra.ub.uni-muenchen.de
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Paul Gertler & David I. Levine & Enrico Moretti, 2003.
"Do Microfinance Programs Help Families Insure Consumption Against Illness?,"
Development and Comp Systems
- Paul Gertler & David I. Levine & Enrico Moretti, 2009. "Do microfinance programs help families insure consumption against illness?," Health Economics, John Wiley & Sons, Ltd., vol. 18(3), pages 257-273.
- Gertler, Paul & Levine, David I. & Moretti, Enrico, 2003. "Do Microfinance Programs Help Families Insure Consumption Against Illness?," Center for International and Development Economics Research, Working Paper Series qt5811j217, Center for International and Development Economics Research, Institute for Business and Economic Research, UC Berkeley.
- Mark M. Pitt & Shahidur R. Khandker & Omar Haider Chowdhury & Daniel L. Millimet, 2003. "Credit Programs for the Poor And the Health Status of Children in Rural Bangladesh," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 44(1), pages 87-118, February.
- Mark Schreiner, 2001.
"A Cost-Effectiveness Analysis of the Grameen Bank of Bangladesh,"
Development and Comp Systems
- Mark Schreiner, 2003. "A Cost-Effectiveness Analysis of the Grameen Bank of Bangladesh," Development Policy Review, Overseas Development Institute, vol. 21, pages 357-382, 05.
- Amin, S. & Rai, A.S. & Topa, G., 1999.
"Does Microcredit Reach the Poor and Vulnerable? Evidence from Northern Bangldesh,"
99-06, C.V. Starr Center for Applied Economics, New York University.
- Amin, Sajeda & Rai, Ashok S. & Topa, Giorgio, 2003. "Does microcredit reach the poor and vulnerable? Evidence from northern Bangladesh," Journal of Development Economics, Elsevier, vol. 70(1), pages 59-82, February.
- Amin, S. & Rai, A.S. & Topa, G., 2000. "Does Microcredit Reach the Poor and Vulnerable? Evidence from Nothern Bangladesh," Papers 28, Chicago - Graduate School of Business.
- Sajeda Amin & Ashok S. Rai & Giorgio Topa, 1999. "Does Microcredit Reach the Poor and Vulnerable? Evidence from Northern Bangladesh," CID Working Papers 28, Center for International Development at Harvard University.
- Lapenu, Cécile & Zeller, Manfred, 2001.
"Distribution, growth, and performance of microfinance institutions in Africa, Asia, and Latin America,"
114, International Food Policy Research Institute (IFPRI).
- Lapenu, Cécile & Zeller, Manfred, 2001. "Distribution, growth, and performance of microfinance institutions in Africa, Asia, and Latin America," FCND discussion papers 114, International Food Policy Research Institute (IFPRI).
- Joseph P. Kaboski & Robert M. Townsend, 2005. "Policies and Impact: An Analysis of Village-Level Microfinance Institutions," Journal of the European Economic Association, MIT Press, vol. 3(1), pages 1-50, 03.
- Mark M. Pitt & Shahidur R. Khandker & Omar Haider Chowdhury & Daniel L. Millimet, 1998. "Credit Programs for the Poor and the Nutritional Status of Children in Rural Bangladesh," Working Papers 98-4, Brown University, Department of Economics, revised 16 Jan 1998.
- Matin, Imran & Hulme, David, 2003. "Programs for the Poorest: Learning from the IGVGD Program in Bangladesh," World Development, Elsevier, vol. 31(3), pages 647-665, March.
- Coleman, Brett E., 1999. "The impact of group lending in Northeast Thailand," Journal of Development Economics, Elsevier, vol. 60(1), pages 105-141, October.
- Zeller, Manfred & Meyer, Richard L., 2002. "The triangle of microfinance," Food policy statements 40, International Food Policy Research Institute (IFPRI).
- Mark M. Pitt & Shahidur R. Khandker, 1998. "The Impact of Group-Based Credit Programs on Poor Households in Bangladesh: Does the Gender of Participants Matter?," Journal of Political Economy, University of Chicago Press, vol. 106(5), pages 958-996, October.
When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:33140. 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: (Ekkehart Schlicht)
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.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with 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 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.