In a recently published article by CGAP (Consultative Group to Assist the Poor) entitled, ‘Does Microcredit Really Help Poor People,’ Mr Richard Rosenberg examines the scrutiny surrounding the effectiveness of microcredit in alleviating poverty. He argues that because “studies published so far have not supported the proposition that microcredit raises household incomes or improves welfare,” attention has been drawn away from the benefits of microcredit. He claims that “whether or not microcredit and other financial services help people escape from poverty, there is strong evidence poor people value them very highly because these services help them cope with poverty,” as demonstrated by the high demand for microfinance products and the willingness of poor borrowers to repay uncollateralized loans.
By: Stefanie Rubin, Research Assistant
About CGAP (Consultative Group to Assist the Poor):
Housed at the World Bank Group, CGAP (Consultative Group to Assist the Poor) is an independent policy and research center dedicated to providing financial access for the world’s poor. CGAP is supported by over thirty development agencies and private foundations. Its mission is to provide market intelligence, to promote standards and to offer advisory services to governments, microfinance providers, donors and investors.
Additional Resources
Source Article: CGAP: Does Microcredit Really Help Poor People?: http://www2.cgap.org/p/site/c/template.rc/1.26.12511/
Similar Posts:
- MICROFINANCE PAPER WRAP-UP: “Climate Risk and Financial Inclusion: A Regulatory Perspective on Risks and Opportunities;” by Peter Knaack, Peter Zetterli
- MICROFINANCE PAPER WRAP-UP: “Impact of Microcredit on Household Consumption and Assets in Nepal;” by Shalik Ram Pokhrel
- MICROFINANCE PAPER WRAP UP: “Women Agents for Financial Inclusion: Exploring the Benefits, Constraints and Potential Solutions,” by Emilio Hernandez et al, Published by CGAP
- MICROCAPITAL BRIEF: G20, SME Finance Forum Showcase Digital Finance Solutions for MSMEs Via Online Database, Seek Submissions
- MICROFINANCE PAPER WRAP-UP: “Land Titling and Microcredit in Cambodia: Examining the Reality of Hernando de Soto’s ‘Three Steps to Heaven,’” by Milford Bateman