Searching: Research & Analysis

Microcredit Interest Rates

This Occasional Paper explains how a microfinance institution (MFI) should estimate the interest rate on its loans if the institution wants to become sustainable; how to calculate the effective interest yield on loans; and what different loan and repayment methods are used to determine the true rate of interest income received by an MFI. This Occasional Paper also discusses evidence that MFI clients are capable of paying high interest rates, concluding that MFIs should be able to cover their costs.

Savings Are as Important as Credit: Deposit Services for the Poor

Savings are often the only way poor people can manage to pay for a major life event (such as a marriage or funeral), survive a natural disaster, or take advantage of a business opportunity. This Donor Brief outlines what donors can do to support savings services that help poor people improve their lives.

Microcredit: One of Many Intervention Strategies

Microcredit is just one of many strategies that can alleviate poverty, generate income, and promote employment. This Donor Brief outlines for donors when microcredit will be successful, when it is inappropriate, and what alternative interventions can be used to strengthen the livelihoods of the poor.

Exploring Client Preferences in Microfinance

Microfinance products tend to be uniform across large geographic areas. For example, in Bangladesh most microfinance institutions (MFIs) offer some variant of the product pioneered by Grameen Bank—a loan with a term of about a year, repaid in frequent (usually weekly) installments, given in a group context, ostensibly for micro-enterprise use, and with a compulsory savings element.

Measuring Microcredit Delinquency

This Occasional Paper addresses issues surrounding measuring microcredit delinquency rates. Not only can poor ratios mislead donors, they can also obscure urgent problems from microfinance institution managers until it is too late to reverse them.

Savings Mobilization Strategies: Lessons from Four Experiences

Around the world, poor households save in various forms and for various purposes. Although empirical evidence suggests that the poor would deposit if appropriate financial institutions and savings facilities were available, little progress has been made to establish microfinance institutions (MFIs) as full-fledged financial intermediaries.

Introducing Savings in Microcredit Institutions: When and How?

Voluntary deposits as a source of commercial finance for microcredit institutions, has generated a lot of interest and debate in recent years.