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TitleMaccroeconomic Challenges of Microfinance
AuthorSebastian Dullien
SubjectFinancial Sector Development
Date of Publication2011
PublisherEconomic Policy Research Centre (EPRC)
Number of Pages04 pages
Geographical CoverageAfrica, Uganda
KeywordsMacroenomic, Microfinance, Interest rates, Investment
AbstractMicrofinance has been one of the boom sectors in development cooperation over the past years. At times, it was almost seen as a panacea for development. After a number of large-scale projects had failed over the 1960s and 1970s, microfinance was seen to have a number of advantages over traditional approaches of official development aid: First, as funds were disbursed at a decentralized level, political economy problems of planning and implementing projects centrally should be avoided. Second, as a microcredit is to be seen different from a grant, but has to be repaid, it was assumed to motivate people who had remained mostly passive to take the initiative themselves. Third, as a market-based instrument, it was hoped to create entrepreneurial spirit in the population which might trigger a sustained increase in economic activity.
Copyright HolderEconomic Policy Research Centre (EPRC)
Copyright URL
Filesize824518 MB
File FormatPDF
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