Microcredit is the extension of very small loans (microloans) to impoverished borrowers who typically lack collateral, steady employment, or a verifiable credit history. It is designed to support entrepreneurship and alleviate poverty. Many recipients are illiterate, and therefore unable to complete paperwork required to get conventional loans. As of 2009 an estimated 74 million people held microloans that totaled US$38 billion. Grameen Bank reports that repayment success rates are between 95 and 98 percent.
Microfinance is a category of financial services targeting individuals and small businesses who lack access to conventional banking and related services. Microfinance includes microcredit, the provision of small loans to poor clients; savings and checking accounts; microinsurance; and payment systems, among other services. Microfinance services are designed to reach excluded customers, usually poorer population segments, possibly socially marginalized, or geographically more isolated, and to help them become self-sufficient. ID Ghana is an example of a microfinance institution.
Grameen Bank is a microfinance organization and community development bank founded in Bangladesh. It makes small loans to the impoverished without requiring collateral.
Muhammad Yunus is a Bangladeshi social entrepreneur, banker, economist and civil society leader who was awarded the Nobel Peace Prize in 2006 for founding the Grameen Bank and pioneering the concepts of microcredit and microfinance. These loans are given to entrepreneurs too poor to qualify for traditional bank loans. Yunus and the Grameen Bank were jointly awarded the Nobel Peace Prize "for their efforts through microcredit to create economic and social development from below". The Norwegian Nobel Committee said that "lasting peace cannot be achieved unless large population groups find ways in which to break out of poverty" and that "across cultures and civilizations, Yunus and Grameen Bank have shown that even the poorest of the poor can work to bring about their own development". Yunus has received several other national and international honours. He received the United States Presidential Medal of Freedom in 2009 and the Congressional Gold Medal in 2010.
BRAC is an international development organisation based in Bangladesh. In order to receive foreign donations, BRAC was subsequently registered under the NGO Affairs Bureau of the Government of Bangladesh. BRAC is the largest non-governmental development Organisation in the world, in terms of the number of employees as of September 2016. Established by Sir Fazle Hasan Abed in 1972 after the independence of Bangladesh, BRAC is present in all 64 districts of Bangladesh as well as 16 other countries in Asia, Africa, and the Americas.
The United Nations Capital Development Fund (UNCDF) makes public and private finance work for the poor in the world's 46 least developed countries (LDCs).
A micro-enterprise is generally defined as a small business employing nine people or fewer, and having a balance sheet or turnover less than a certain amount. The terms microenterprise and microbusiness have the same meaning, though traditionally when referring to a small business financed by microcredit the term microenterprise is often used. Similarly, when referring to a small, usually legal business that is not financed by microcredit, the term microbusiness is often used. Internationally, most microenterprises are family businesses employing one or two persons. Most microenterprise owners are primarily interested in earning a living to support themselves and their families. They only grow the business when something in their lives changes and they need to generate a larger income. According to information found on the Census.gov website, microenterprises make up 95% of the 28 million US companies tracked by the census.
Aga Khan Agency for Microfinance (AKAM) is a microfinancing agency of the Aga Khan Development Network.
The Association for Social Advancement is a non-governmental organisation based in Bangladesh which provides microcredit financing.
LAPO is a Nigerian organisation with a microfinance bank dedicated to self-employment through microfinance and an NGO, a non-governmental, non-profit community development organization focused on the empowerment of the poor and the vulnerable.
MicroPlace was an American microfinance provider that focused on retail investors. Started by Tracey Pettengill Turner in 2006, MicroPlace was bought out by eBay that same year.
Five Talents is a Christian charity that provides savings programs, and financial literacy and business training for those in need in developing countries. They make use of a form of savings-led microfinance. Five Talents' programs serve people regardless of religious background, and they aim to transform lives through economic empowerment, creating long-term solutions to poverty in the developing world.
Bharat Financial Inclusion Limited or BFIL is a banking & finance company (NBFC), licensed by the Reserve Bank of India. It was founded in 1997 by Vikram Akula, who served as its executive chair until working. The company's mission is to provide financial services to the poor under the premise that providing financial service to poor borrowers helps to alleviate poverty. In 2011, the company operated across 11 Indian state.
Creating shared value (CSV) is a business concept first introduced in a 2006 Harvard Business Review article, Strategy & Society: The Link between Competitive Advantage and Corporate Social Responsibility. The concept was further expanded in the January 2011 follow-up piece entitled Creating Shared Value: Redefining Capitalism and the Role of the Corporation in Society. Written by Michael E. Porter, a leading authority on competitive strategy and head of the Institute for Strategy and Competitiveness at Harvard Business School, and Mark R. Kramer, of the Kennedy School at Harvard University and co-founder of FSG, the article provides insights and relevant examples of companies that have developed deep links between their business strategies and corporate social responsibility (CSR). Porter and Kramer define shared value as "the policies and practices that enhance the competitiveness of a company while simultaneously advancing social and economic conditions in the communities in which it operates", while a review published in 2021 defines the concept as "a strategic process through which corporations can turn social problems into business opportunities".
Jonathan Morduch is a professor of public policy and economics at the Robert F. Wagner Graduate School of Public Service at New York University. He is a development economist most well known for his significant academic contributions to assessing the impact of microfinance since the early years of the movement. He has written extensively on poverty and financial institutions in developing countries and on tensions between achieving social impacts and meeting financial goals in microfinance.
Financial inclusion is the availability and equality of opportunities to access financial services. It refers to a process by which individuals and businesses can access appropriate, affordable, and timely financial products and services which include banking, loan, equity, and insurance products. It is a path to enhance inclusiveness in economic growth by enabling the unbanked population to access the means for savings, investment, and insurance towards improving household income and reducing income inequality
Microfranchising is a business model that applies elements and concepts of traditional franchising to small businesses in the developing world. It refers to the systemization and replication of micro-enterprises. Microfranchising is broadly defined as small businesses that can easily be replicated by following proven marketing and operational concepts.
Pride Microfinance Limited (PMFL), is a microfinance deposit-taking institution (MDI) in Uganda. It is licensed by the Bank of Uganda, the central bank and national banking regulator.
The Vicariate of Solidarity was a human rights organization in Chile during the military dictatorship of Augusto Pinochet. A Catholic organisation, it was created by Pope Paul VI at the request of cardinal Raúl Silva Henríquez to replace the Committee of Cooperation for Peace in Chile. The Vicariate of Solidarity aimed to provide assistance to the victims of the Pinochet dictatorship and their families.
Akhuwat Foundation is a nonprofit organization based in the country of Pakistan that provides interest-free loans to individuals who are unable to access formal financial services. It was founded in 2003 by Dr. Muhammad Amjad Saqib who is the executive director of the organization. Akhuwat's head office is located in Lahore and it has over 3 branches across 1,500 cities in Pakistan.
