Remittances: strategic and operational considerations
Exceeding USD 230 billion in 2005, remittances are a critical flow of funds for low-income people in both the North and South. Accessing and affording these services, however, can be a challenge, especially in remote, rural areas. This annex to the IFAD Decision Tools for Rural Finance introduces migrant remittances in the wider context of development finance, discussing the key principles of effective service delivery and highlighting potential areas for IFAD support. Designed to give IFAD staff a solid grounding in this topic, this paper includes a review of donor activity on remittances and provides numerous references to research on remittances in specific regions.
Handbook for the analysis of the governance of microfinance institutions
Beyond financial viability, successful and sustainable microfinance institutions (MFIs) have articulated a clear strategic vision and implemented transparent internal processes acceptable to all stakeholders. This handbook outlines a method to evaluate an MFIs’ approach to its systems and organization according to six fundamental elements of good governance. Written by Cécile Lapenu of the Comité d’échanges, de réflexion et d’information sur les systèmes d’épargne-crédit (CERISE) and Dorothée Pierret, consultant with the Institut de recherches et d’applications des méthodes de développement, this guide is based on the field experience of CERISE and their microfinance partners.
Assessing and managing social performance in microfinance
Many microfinance institutions (MFIs) have a “double bottom line:” they work toward both a social mission and financial sustainability. Assessing and managing social performance details several tools that evaluate how an MFI translates their social mission into practice, encouraging a transition from one-off impact assessments to the continuous monitoring of social performance. This publication was produced with significant input from Anton Simanowitz of Improving the Impact of Microfinance on Poverty, a three-year action-research programme working with 30 rural finance institutions in 20 countries, and Cécile Lapenu of the Comité d’Echanges, de Réflexion et d’Information sur les Systèmes d’Epargne-crédit.
IFAD and CGAP: Best practice in contemporary agricultural microfinance
With financial support from IFAD, in 2002 the Consultative Group to Assist the Poor (CGAP) launched a research initiative on emerging lessons in agricultural microfinance. These two publications present the findings of this research.
Emerging lessons in agricultural microfinance: Selected case studies
Based on desk reviews, consultant site visits and stakeholder consultations, CGAP identified a shortlist of institutions actively engaged in agricultural finance with the potential to achieve scale and sustainability. Selected from this shortlist, Emerging lessons presents several case studies to offer insight, lessons learned and analyses relevant and useful to donors, investors, financial institutions and others engaged in promoting financial services to the many millions of poor people dependant on agriculture.
These five case studies—Confianza in Peru, the Bai Tushum Financial Foundation in Kyrgyzstan, Caja Los Andes in Bolivia, Equity Bank Limited in Kenya, and the Cooperative League of the USA in Mozambique—were used by CGAP to finalize Occasional Paper 11 on Managing Risks and Designing Products for Agricultural Microfinance: Features of an Emerging Model, also presented below.
Managing risks and designing products for agricultural microfinance: Features of an emerging model
Based on these case studies and their wider research, CGAP also identified the ten cross-cutting features that characterize successful agricultural microfinance portfolios in Managing risks and designing products for agricultural microfinance. Written by Robert Peck Christen of the Boulder Microfinance Institute and Douglas Pearce of the UK Department for International Development, CGAP first issued this publication as Occasional Paper 11 in 2005. IFAD has re-issued this paper here as part of the 2006 IFAD series of rural finance publications.
The Good Practice Guidelines for Funders of Microfinance providespractical guidance for donor staff on how to best interact with and support the various actors in microfinance.
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IFAD and FINCA: Commercialization among village banks in Latin America
Many microfinance institutions (MFIs) are taking a lesson from mainstream banks and adopting a more market-oriented approach to their mission, even transforming into licensed financial institutions in some cases. In this process called commercialization, donor resources—such as the grant that IFAD provided to FINCA—can help MFIs access technical assistance to mitigate the risks involved.
Written by Scott Graham of FINCA International,these two papers describe how an IFAD technical assistance supported FINCA village banking affiliates in rural Latin America as they transformed into licensed financial institutions.
Village banks – The new generation: How IFAD helped FINCA set its village banking programmes on the road to commercialization
This shorter, more accessible paper gives an overview of village banking, as well as the fundamental benefits and constraints to commercialization among MFIs. Appropriate for readers new to microfinance, Village banks – the new generation provides an overview of the IFAD grant to FINCA and describes some of the new challenges faced by the FINCA affiliates that have undertaken the process of commercialization.
Supporting innovation in the field: The role of IFAD’s support in the sustainability and commercial transformation of FINCA’s village banking programmes
Designed for IFAD staff and other donors, practitioners, researchers, and policy makers more familiar with microfinance, Supporting innovation in the field provides more detail than Village banks – the new generation. This longer, more technical paper describes the lessons learned at FINCA on the commercial transformation of their village banks during implementation of the three-year technical assistance grant from IFAD.
