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Micro Finance Models
  • Vrajlal K Sapovadia, SBS Ahmedabad
  • Kandarp V Patel
  • Sweta V Patel
As per World Bank estimate, 7000 Micro-Finance Institutes serving 16 million poor people with approximate total turnover for MFI's estimated $2.5-$7 billion (2007). Repayment rates of micro finance are almost 97%, substantially higher than the normal commercial finance. US$ 21.6 Billion still needed to provide microfinance to 100 million of the world's poorest families. Micro Finance is about financing services to the poor & micro entrepreneurs. Financing includes saving, credit, insurance, remittances and so on. Micro Credit is defined as provision of thrift, credit and other financial services and products of very small amount to the poor in rural, semi-urban and urban areas for enabling them to raise their income levels and improve living standards. Micro Finance/Credit Institutions are those which provide these facilities. There are several definitions of micro finance and plenty of models world wide through which micro financing industry works. Depending upon socio-economic conditions, political and cultural environment, technical advancement of the country and institutionalizations, numerous methods and mechanisms have been developed across the globe. This model works around individual lending or group lending, direct or indirect (through intermediary), variant in payment & repayment methods, interest component etc. The book describes various MF models and institutes behind it in South Asia (India, Bangladesh, and Philippines etc.), Latin America, Africa and other part of the world. The model works around four pillars of Micro Finance; namely: Supply, Demand, Consumers & Legal framework. We discuss prevailing global models across the line of theses four pillars known to us; however several models might have gone unnoticed.
  • Micro Finance Models,
  • SHG,
  • Grameen Bank
Publication Date
Lambert Academy Publishing
Citation Information
Vrajlal K Sapovadia, Kandarp V Patel and Sweta V Patel. Micro Finance Models. Germany(2010)
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