Australian Development Gateway

The Australian Development Gateway (ADG) strives to support members of the development community in their efforts to reduce poverty and enhance sustainable development in the Asia Pacific region. The site has been created with participation from members of government, private, academia and non-government organisations. User feedback mechanisms have been incorporated to guide future directions of the site. The site is optimised for low bandwidth access to enable the widest participation throughout the Asia Pacific region.

Skip to content

ADG channels:

Information by sector: Enterprise Development

Sub navigation

ADG TOOLBOX

Interest Rates

Making sense of microcredit interest rates (pdf 1.17mb)

This brief highlights some of the key issues relating to microfinance and microcredit interest rates and the role of donors.

Interest rates are set with the aim of providing viable, long-term financial services on a large scale. Microfinance institutions must set rates that cover all costs needed to sustain their services. Unless MFIs do so, they may only operate for a limited time, reach a limited number of people, and will tend to be driven by donor or government goals.

 

Footer: