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Microfinance partnerships: capacity building (pdf 453kb)

This article by the FDC's Jamie Bedson flags some of the recent changes in Asia's microfinance industry and emphasises the importance of strategic partnerships to the survival of the sector.

Microfinance institutions (MFIs) have formed links with banks and other organisations to expand credit outreach, and with economic and social service providers to help manage their credit risks and extend the social and economic impact of their services. This article argues that the increasing commercialisation of the Asian microfinance sector means that the ability of institutions to identify, build, and manage their relationships with external parties, and to form mutually complementary strategic partnerships, will become increasingly important to their survival.

The article further argues that a commitment is needed to build the capacity of organisations, especially of small MFIs, to actively broker and enter into partnerships on an equitable basis while also sharing the successes and failures of the microfinance sector widely and in a language that can be easily understood by all stakeholders.

'Microfinance Partnerships: Capacity Building' appeared in the ADB's June 2008 'Finance for the Poor' newsletter - please refer to page 13 to read this article.

 

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