5th International Virtual Conference (IVC-2018).  International E-publication: Publish Projects, Dissertation, Theses, Books, Souvenir, Conference Proceeding with ISBN.  International E-Bulletin: Information/News regarding: Academics and Research

A survey of research conclusions and recommendations on the impact of the practice of microfinancing on poverty reduction in selected countries outside Sub-Saharan Africa

Author Affiliations

  • 1Department of Economics, Mangalore University, Karnataka, India
  • 2Department of Economics, Mangalore University, Karnataka, India

Int. Res. J. Social Sci., Volume 7, Issue (5), Pages 39-49, May,14 (2018)


Microfinance is one development proposition that has gained much attention over the past few decades as an antipoverty strategy. Although various forms of what we now call 'microfinance' dates back centuries ago, institutional microfinancing has attracted worldwide recognition- since the establishment of the Grameen Bank in Bangladesh- as an antipoverty tool. Microfinance is deemed to be effective in fostering financial inclusion via extending financial services to the entrepreneurial poor aimed at "freeing" and then assisting them to do better. We adopt a methodology by surveying research conclusions and recommendations conducted in some emerging economies outside Sub-Saharan Africa- based on random selection of research publications- as available on the internet. The aim is to appreciate some similarities and/or divergence of research conclusions and recommendations whereby certain generalizations (especially of shortcomings of the practice of microfinancing via research findings and subsequent recommendations) could be deduced. Subsequently, we discuss and highlight current microfinance operations/practices which attempt to satisfy the recommendations, extracted. In all, twenty-five research conclusions and recommendations of thirteen countries were surveyed. By analyzing them, we conclude that the impact of the practice of microfinance on poverty in the majority of cases cited is positive. The two common recommendations, however, are for current microfinance practice to be 'enhanced' by the provision of 'training' to clients and 'responsible government supervision and collaboration with MFIs' to realize desirable intended impact. We recommend that sustainable microfinancing requires responsible finance based on a well thought out partnership and relationship-building strategy.


  1. Robinson M.S. (2001)., The Microfinance Revolution- Sustainable Finance for the Poor., The World Bank, Washington, D.C. Open Society Institute, New York. pp. 10, 11, 23, ISBN 0-8213-4524-9. http://documents. worldbank.org/curated/en/226941468049448875/pdf/232500v10REPLA18082134524501PUBLIC1.pdf (Accessed, 2nd December 2017).
  2. Vincent G. (2005)., Sustainable Microentrepreneurship: The Role of Microfinance, Entrepreneurship and Sustainability in Reducing Poverty in Developing Countries., . gdrc.org/icm/micro/guy_sust-micro.pdf (Accessed, 7th February 2018).
  3. The Holy Bible: Exodus 22:25. (2018)., If you lend money to one of my people among you who is needy, do not treat it like a business deal; charge no interest., https://www.biblestudytools.com/topical-verses/money-bible-verses/ (Accessed, 7th April 2018).
  4. The Holy Quran (Ch 2:279-280) (2009)., The Quran asks lenders to give up whatever remains outstanding in interest., Cited in Kaleem A. and Ahmed S. (2009). "The Quran and Poverty Alleviation: A Theoretical Model for Charity-Based Islamic Microfinance Institutions". Nonprofit Voluntary Sector Quarterly 2010 29:409. DOI: 10.1177/0899764009332466) http://nvs.sagepub.com/ content/39/3/409 (Accessed 7th April 2018)
  5. Fung Y.M. (2014)., Ren as a Heavy Concept In The Analects., Journal of Chinese Philosophy, 41(1-2), 91-113.. https://onlinelibrary.wiley.com/doi/pdf/10.1111/1540-6253.12088 (Accessed 7th April 2018)
  6. The Kitab-i-Aqdas 56:33 (2018)., To Engage in Some Occupation., http://www.bahai.org/library/authoritative-texts/bahaullah/kitab-i-aqdas/
  7. The Torah (Isaiah 58:7-8, 10-11; Proverbs 14:31) (2018), Judaism's Commitment to Caring for the Poor and Hungry. https://mazon.org/get-involved/hunger-and-jewish-texts/ judaisms-commitment-to-caring-for-the-poor-and-hungry (Accessed, 7th April 2018), undefined, undefined
  8. Na Rangsi S. (1998)., Buddhist Philosophy from Tripitaka., Bangkok: Chulalongkorn University Press. Chapter II, 169. The Significance of the Tripitaka. http://shodhganga.inflibnet.ac.in/bitstream/10603/76698/6/chapter%202.pdf (Accessed 11th March 2018).
  9. Visconti R.M. (2015)., A Survey of Microfinance for Developing Countries: A Social Responsible Investment Opportunity., JEL Classification G21, H81, 130, L31, O19.
  10. Roodman D. (2012)., Due diligence: an impertinent into microfinance., Center for Global Development, Washington D.C. Brookings Institution Press, 52. ISBN 978-1-933286-48-8.
  11. Seibel H.D. (2005)., Does History Matter? The Old and the New World of Microfinance in Europe and Asia., Cologne: University of Cologne. http://www.microfinancegateway .org/library/does-history-matter-old-and-newworld microfinance-europe-and-asia. (Accessed 2nd December 2017).
  12. Balkenhol B. (2007)., Efficiency and sustainability in microfinance., In Balkenhol, B. eds. Microfinance and Public Policy. Outreach, performance and efficiency. PALGRAVE MACMILLAN, New York, N.Y. and International Labor Office, Geneva, Switzerland, 3-23.
  13. Harvard Business Review (HBR) (2015)., The Birth of Modern Commercial Credit., 32-33. Also available: https://www.library.hbs.edu/hc/credit/credit3b.html (Accessed, 30th April 2018).
  14. Mader P. (2015)., The Political Economy of Microfinance - Financialising Poverty., Palgrave Macmillan, UK., 38. ISBN: 978-1-137-00150-4 Paperback.
  15. Nobel Prize (2006)., Citation to Nobel Laureate Muhammad Yunus and the Grameen Bank., https://www.nobelprize.org/nobel_prizes/peace/laureates/2006/ (Accessed, 21st November 2017).
  16. Sayvaya I. (2012)., Does Microfinance Reduce Poverty in Lao PDR? Case Study of Village Development Funds (VDFs) at Sukuma District Champassak Province, Lao PDR., Mekong Institute Research Working Paper Series No. 4/2012. www.mekonginstitute.org/uploads/ tx_ ffpublications/wps-2012_4_microfinance.pdf (Accessed, 27th March 2018).
  17. Barr M.S. (2004)., Microfinance and Financial Development., Michigan Journal of International Law, 278. 26, No. 1, 271-296. https://repository.law.umich.edu/ cgi/viewcontent.cgi?article=1060&context=articles (Accessed, 6th April 2018).
  18. Yaidoo L.I.K. and Vishwanatha K. (2018)., Microfinance: A review of the Literature- Development Strategy Recommendations for Improving Low Income and Poverty Reduction in Ghana., International Journal of Social Sciences, 7(4), 1-6. ISSN 2319-3565. http://www.isca.me/ IJSS/Archive/v7/i4/2.ISCA-IRJSS-2018-012.php(Accessed, 21st April 2018).
  19. Chasmar K. (2009)., The Commercialization of Microfinance in Latin America., World Bank Group [US] https://www.microfinancegateway.org/sites/default/files/mfg-en-paper-the-commercialization-of-microfinance-in-latin-america-apr-2009.pdf (Accessed, 3rd January 2018).
  20. Augsburg B., De Haas R., Harmgart H. and Meghir C. (2015)., The impacts of microcredit: Evidence from Bosnia and Herzegovina., American Economic Journal: Applied Economics, 7(1), 183-203. http://dx.doi.org/10.1257/ app.20130272 (Accessed, 8th April 2018).
  21. Chowdhury J.A., Ghosh D. and Wright R.E. (2002)., The Impact of Microcredit on Poverty: Evidence from Bangladesh., World Bank Group. https://www. microfinancegateway.org/sites/default/files/mfg-en-paper-impact-of-microcredit-on-poverty-evidence-from-bangladesh-may-2002.pdf (Accessed, 9th April 2018).
  22. Khandker S.R. (2005)., Microfinance and poverty: Evidence using panel data from Bangladesh., The World Bank Economic Review, 19(2), 263-286. https:// openknowledge.worldbank.org/bitstream/handle/10986/16478/774910JRN020050ofinance0and0Poverty.pdf%3Bjsessionid%3D1817DC7CDB06A4D9408A3082CBB574DB?sequence%3D1 (Accessed, 9th April 2018).
  23. Roy M.K. and Biswas T.K. (2014)., Microcredit and Poverty Reduction in Bangladesh., ASA University Review, 8(1). https://pdfs.semanticscholar.org/ 2606/ 28adf 0703f16c6a25eea72a70476e401e8bc.pdf (Accessed, 9th April 2018).
  24. Pakistan Gallup (2003)., PPAF Micro Credit Financing: Assessment of Outcomes., September 2003. Pakistan Poverty Alleviation Fund. http://www.ppaf.org.pk/doc/ microfinance/15.pdf (Accessed, 9th April 2018).
  25. Shirazi N.S. and Khan A. (2009)., Role of Pakistan Poverty Alleviation Fund’s Micro Credit in Poverty Alleviation- A Case of Pakistan., Pakistan Economic and Social Review, 47(2), 215-228. https://www.scribd.com/document/ 184376395/Micro-Finance-Impact-Research-Paper-Based-on-Gallup-Pakistan-s-Study-for-PPAF (Accessed, 9th April 2018).
  26. Iqbal Z., Iqbal S. and Mushtaq M.A. (2015)., Impact of Microfinance on Poverty Alleviation: The Study of District Bahawal Nagar, Punjab, Pakistan., Management and Administrative Science Review, 4(3), 487-503. http:// citeseerx.ist.psu.edu/viewdoc/download?doi= (Accessed 10th April 2011).
  27. Jayasuriya P.K. (2007)., Impact of Microfinance on Poverty Alleviation in Sri Lanka: Special Reference to Sammurdhi Programme., Proceedings of the Annual Research Symposium. Faculty of Graduate Studies, University of Kalaniya, 55. http://repository.kln.ac.lk/ handle/123456789/7584 (Accessed, 10th Aril 2018).
  28. Kuluarachchi D.G.P. and Jahfer A. (2014)., Microfinance and Poverty Alleviation in Sri Lanka., Paper Presented at the 4th International Symposium, South Eastern University of Sri Lanka (SEUSL). http://www.seu.ac.lk/ research and publications/symposium/4th/businessmanagement/Micro%20Finance%20and.pdf (Accessed, 10th April 2018).
  29. Le C.A. (2017)., Microfinance: The Impact of a Poverty Reduction Approach and Financial Systems Approach on Poor Rural Households in Vietnam., University Honors Thesis paper 454. Portland State University. https:// pdxscholar.library.pdx.edu/cgi/viewcontent.cgi?referer=https://www.google.co.in/&httpsredir=1&article=1532&context=honorstheses (Accessed 10th April 2018).
  30. Adhikari D.B. and Shrestha J. (2013)., Economic Impact of Microfinance in Nepal: A Case Study of the Manamaiju Village Development Committee, Kathmandu., Economic Journal of Development, 15 and 16 (1-2), Combined Issue. https://www.nepjol.info/index.php/EJDI/article/viewFile/11861/9654 (Accessed, 11th April 2018).
  31. Limbu D.S. (2014)., Role of Microfinance in Poverty Reduction and Women Empowerment: A Case Study of Bayarban VDC of Morang District., Master of Arts Thesis, Submitted to the Central Department of Economics, Tribhuvan University, Kritipur, Kathmandu, Nepal. (Accessed, 11th April 2018).
  32. Dhakal C.P. and Nepal G. (2016)., Contribution of Microfinance on Socio-Economic Development of Rural Community., Journal of Advanced Academic Research (JAAR). ISSN: 2362-1303. https://www.nepjol.info/ index .php/JAAR/article/download/16623/13472 (Accessed, 11th April 2018).
  33. Devaraja T.S. (2011)., Microfinance in India-A tool for poverty reduction., University of Mysore. Mysore: University Grants Commission of India. http:// sibresearch.org/uploads/2/7/9/9/2799227/microfinance-_devaraja.pdf (Accessed, 11th April 2018).
  34. Mishra S., Mall M. and Mishra P.K. (2013)., Microfinance: a tool for poverty alleviation., American International Journal of Research in Humanities, Arts and Social Sciences, 3(2), 236-238. https://www.researchgate.net/ profile/Pk_Mishra4/publication/280881902_Microfinance_The_Tool_for_Poverty_Alleviation/links/55ca2f3408aeca747d69e275/Microfinance-The-Tool-for-Poverty-Alleviation .pdf (Accessed, 11th April, 2018).
  35. Shetty N.K. (2008)., The Microfinance Promise in Financial Inclusion and Welfare of the Poor: Evidence from Karnataka, India., Institute for Social and Economic Change, Working Paper 205. http://www.isec.ac.in/ WP%20-%20205.pdf (Accessed, 11th April 2018).
  36. Banerjee A., Duflo E., Glennerster R. and Kinnan C. (2014)., The Microfinance Miracle? Evidence of Randomized Evaluation., https://economics.mit.edu/ files/5993 (Accessed 7th February 2018).
  37. The World Bank (2012)., Microfinance Poverty Reduction Project., Report No: ICR 1756. http://documents.worldbank.org/curated/en/554931468195840228/pdf/ICR17560P091260C0disclosed040160130.pdf (Accessed, 11th April 2018).
  38. Hadidi H.E. (2016)., Impact of Microfinance Services on Rural Egyptian Women Empowerment: An Empirical Study., American Scientific Research Journal for Engineering, Technology, and Sciences (ASRJETS), 22(1), 109-125.
  39. Farag N.M. (2011)., Microfinance and Poverty Alleviation: A Case Study of Al-Darb Al-Ahmar District in Cairo, Egypt., A Master of Arts Thesis Submitted to the Department of Economics, American University in Cairo, Egypt. http://dar.aucegypt.edu/bitstream/handle/ 10526/ 2263/ETD_2011-Spring_Noran-Farag_Thesis.pdf? sequence=3 (Accessed, 12th April 2018).
  40. Crépon B., Devoto F., Duflo E. and Paiente W. (2011)., Impact of Microcredit in Rural Areas of Morocco: Evidence from a Randomized Evaluation., Working Paper. http://www.tcd.ie/Economics/assets/pdf/William%20Pariente.pdf (Accessed, 11th April 2018).
  41. Mosley P. (2001)., Microfinance and Poverty in Bolivia., Journal of Development Studies, 37(4), 101-132. DOI: 10.1080/00220380412331322061. https://www.tandfonline.com/doi/pdf/10.1080/00220380412331322061?needAccess=true (Accessed, 12th April 2018).
  42. Agbola F.W., Acupan A. and Mahmood A. (2017)., Does Microfinance Reduce Poverty? New Evidence from Northeastern Mindanao, the Philippines., Journal of Rural Studies, 50, 159-171. https://ac.els-cdn.com/ S0743016716305733/1-s2.0-S0743016716305733-main.pdf?_tid=4d067b84-838e-4f6e-8417-ef926d39df30&acdnat=1523636264_8f57cefe10c30f8dc6813c6edb25a954 (Accessed, 13th April 2018).
  43. Dingcong C., Infantado C., Kondo T. and Orbeta Jr A. (2008)., Impact of microfinance on rural households in the Philippines., Philippines Institute for Development Studies. https://dirp4.pids.gov.ph/ris/dps/pidsdps0805.pdf (Accessed, 13th April 2018).
  44. Montgomery H. and Weiss J. (2005)., Great Expectations: Microfinance and Poverty Reduction in Asia and Latin America., ADB Institute Research Paper Series No. 63. https://www.adb.org/sites/default/files/publication/157174/adbi-rp63.pdf (Accessed, 2nd March 2018).
  45. Duvendack M., Palmer-Jones R., Copestake J.G., Hooper L., Loke Y. and Rao N. (2011)., What is the Evidence of the Impact of Microfinance on the Well-being of Poor People?., EPPI-Centre, Social Science Research Unit, Institute of Education, University of London. ISBN: 978-1-907345-19-7. https://www.microfinancegateway.org/ sites/default/files/mfg-en-paper-what-is-the-evidence-of-the-impact-of-microfinance-on-the-well-being-of-poor-people-policy-brief-aug-2011.pdf (Accessed, 2nd February 2018).
  46. Rhyne E. (1998)., The Yin and Yang of Microfinance: Reaching the Poor and Sustainability., MicroBanking Bulletin, 2(1), 6-8. http://www.jointokyo.org/ mfdl/ readings/Rhyne-yingyang.pdf (Accessed, 15th April 2018).
  47. Roy A. (2010)., Poverty Capital- Microfinance and the Making of Development., Routledge, Taylor and Francis: London, New York. Chapter 3, 93-105. Master e-book ISBN 0-203-85471-3; ISBN 10:0-415-87672-9 (hbk), ISBN 10:0-415-87673-7 (pbk), ISBN 13-0-203-85471-3 (ebk).
  48. Sherratt L. (2016)., Can Microfinance Work? How to Improve its Ethical Balance and Effectiveness., Oxford University Press, 19. ISBN: 97801993831919 (alk. paper).
  49. CGAP (2018)., CGAP Announces New Platform for Graduation Approach., http://www.cgap.org/news/cgap-announces-new-platform-graduation-approach (Accessed, 5th January 2018).
  50. Microcredit Foundation Horizonti (2010), Innovative approaches for providing Sustainable Financial Services to the Roma Community- Republic of Macedonia. https://www.european-microfinance.org/sites/default/files/ document/file/9.financial-services-horizonti_2010.pdf (Accessed, 18th April 2018)., undefined, undefined
  51. Kumar K.N. (2017)., Microfinance for Entrepreneurial Development: Study of Women's Group Enterprise in Development., Chapter 3, 53-58. In Cumming, D., Dong, Y., Hou, W., and Sen, B. (Eds) (2017). Microfinance for Entrepreneurial Development- Sustainability and Inclusion in Emerging Markets. Palgrave Macmillan. ISBN 978-3-319-62110-4, ISBN 978-3-319-62111-1 (eBook). DOI 10.1007/978-3-319-62111-1.
  52. Sen A. (1999)., Development as Freedom., Alfred A. Knopf Publishers, New York. Chapter 4, 87-89. ISBN 0-375-40619-0 (alk. paper).