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Shelter finance for the poor series synthesis (English)

The Shelter Finance for the Poor Initiative provides a framework for financing that has been applied to five case studies. These include: Mibanco in Peru, SEWA in India, FUNHAVI in Mexico; a wholesale fund facility in Ecuador, and the enabling environment for shelter finance in Kenya. This synthesis paper makes three central points: 1) there is strong demand from poor people for housing finance services tailored to the way they build; 2) lessons are emerging in large part from microfinance institutions building on earlier successes with working capital loans, and innovating with new housing loan products; and 3) the large potential for achieving scale and sustainability can be realized if financial institutions, governments, and donor agencies work in concert. Also, this synthesis paper identifies emerging policy recommendations on taking housing finance for the poor to scale. Preliminary analysis of the emerging housing finance industry for the poor is demonstrating that the poor are reliable clients who are willing to pay the full cost for cost-effective services tailored to their needs. Pioneer financial institutions are continuing to build on their strengths and innovate with new product offerings such as shelter finance to retain and expand their clients.The initial round of innovations in this area is likely to come from the existing generation of microfinance institutions. But with proven success, as is happening with the commercialization of microfinance, they will be paving the path for a whole new set of players (commercial banks, mortgage finance companies, private builders and others who typically shy away from poor people).

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Citation

Malhotra, Mohini [editor]

Shelter finance for the poor series synthesis (English). CIVIS notes series,no. 4v. Shelter Finance for the Poor series Washington, D.C. : World Bank Group. http://documents.worldbank.org/curated/en/271721468141297481/Shelter-finance-for-the-poor-series-synthesis