When poor people have access to financial services, they can earn more, build their assets, and cushion themselves against external shocks. Poor households use microfinance to move from everyday survival to planning for the future: they invest in food,clothing, housing, health, and education.

Microfinance means building financial systems that serve the poor. In most developing countries, poor people are the majority of the population, yet they are the least likely to be served by banks. Microfinance is often seen as a marginal sector—a “development” activity that donors, governments, or social investors might care about, but not as part of the country’s mainstream financial system. However, microfinance will reach the maximum number of poor clients only when it is integrated into the financial sector.

Microfinance can pay for itself, and must do so if it is to reach very large numbers of poor people. Most poor people cannot get good financial services that meet their needs because there are not enough strong institutions that provide such services. Strong institutions need to charge enough to cover their costs. Cost recovery is not an end in itself. Rather, it is the only way to reach scale and impact beyond the limited levels that donors can fund. A financially sustainable institution can continue and expand its services over the long term. Achieving sustainability means lowering transaction costs, offering services that are more useful to the clients, and finding new ways to reach more of the unbanked poor.

But what is happening today in the garb of Micro Finance is cheating the poor. MFIs are exploiting the poor by charging very high interest for the loan they take. Moreover only the well to do among the poor have access to most MFIs.This must go a radical change. Micro Finance lenders like World BANK, FWWB, and many others should change their policy -IF THEY REALLY CARE FOR THE POOREST OF THE POOR to give priority to Organizations working for the Disadvantaged.

I thank the SEEP network for Bringing us together to discuss issues like these. And I would like to say that a proper report about this conference be posted for others to learn form this.
i agree with the posting by Alexander. Its is high time MFIs beging to see areas they can contribute to the development of humanity in helping to reduce poverty level and meeting up with social economic condition of the poor.

Every day programs are made, reports about funding for development displayed. Yet the MFIs still borrow to the rich and Africa, the rich uses this aproach in getting richer.

Nigerian plan for poverty Alliviation is to learn from this ideas and other MFIs on how bests to help the poor and the needy not the rich.

For us to achieve the MDGs, we must all come back to the drawing board and network.

The goals are achievable and there is need to sustain these project.

In HIV/AIDS, we must look at it as very challenging issues. We lend to those that we think can pay and sometimes, dont pay. The people living with HIV can do more in sustaining the project as we have the network of people living with HIV and also of importance is for MFIs to link other NGOs/CBOs to access miccrocredit that will be use to start an income generating activities for sustainability. Without waiting and depending on external funding.(Global fund,IMF, World bank and other charity)

Where are we?
Lets all unite and speak development and not lony collecting. The idea of my own NGO will not work if we dont learn form others and unite as community for change. These will all bumerang both directly and indirectly.

The MFIs in the developing countries like Nigeria, should see how they can contribute to the health sector development if not who will be there to access the credit.
There is an adage in Africa that says “ The horse gave birth so that it can be able to stretch its waist” What if the donors are not there, what can we do?

We must live for tomorrow but we all have to start building it now.

Thanks for being in the vanguard of chage

Thank you so much for your acknowledgement and fine points. I wanted to make sure you are aware that we are currently having a larger discussion on this topic at:

http://communities.seepnetwork.org/me_hiv_conf/discussion

Please join us and post further insights on this topic there!

Mary McVay
The SEEP Network