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Microfinance
Innovation and Outreach Programme
The objective of this recently approved programme is to improve and increase poor people's access to a wide range of financial services and products. The programme will be an integral part of the credit and enterprise development programme of the Pakistan Poverty Alleviation Fund (PPAF), a government-created funding agency operating through NGO partner organizations. It will be national in scope but will concentrate exclusively on rural areas and poor communities. The IFAD-initiated programme targets small farmers and livestock owners, traders and microentrepreneurs, and particularly women and households headed by women. Working in close collaboration with PPAF, the programme will develop a response to the demand among rural poor people for increasingly available credit and a broader range of diversified microfinance services. It will encourage existing microfinance operators, currently or potentially partners of PPAF, to explore ways of extending their outreach. The aim is to bring financial services and products to people in remote communities and to overcome cultural and religious barriers to traditional credit, as well as gender bias and inappropriate delivery systems. The programme will support development and testing of many types of microfinance products, including livestock insurance, leasing arrangements and equity partnerships, as well as Islamic modes of financing based on profit-sharing. It encourages development of new financing systems, including systems that reduce the burden of debt, minimize risk and promote asset creation. The programme will emphasize development of approaches and products particularly keyed to women's needs. Through a flexible funding mechanism, the programme will encourage microfinance operators to implement pilot projects to test and develop new products and approaches, and it will finance their scaling up. The microfinance operators will work with their own member community organizations and with participating rural poor people, who will become the recipients of the newly developed financial products. Source: IFAD |
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