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Raising the curtain on the "microfinancial services era" : Comienza la "era de los servicios microfinancieros" (Spanish)

From the 'agricultural credit era' (1950s-1970s) through the 'micro-enterprise era', institutional arrangements and product designs that characterized financial services to the poor were underpinned by a dominant image of the poor. First, the image of the poor as small and marginal farmers drove the disbursement of agricultural loans from special, often governmental, institutions using foreign grants and soft loans. Subsequent views of the poor as women entrepreneurs resulted in the delivery of increasingly large working capital loans by mostly voluntary organizations to poor women organized into groups offering joint liability. Whatever the strengths and weaknesses of these approaches - and experience has taught us many lessons - the arguments which supported them were clear, even though they may now appear simplistic. Farmers need crop loans. Poor businesswomen need a steady supply of easily repaid loans which grow with their businesses. As we move into the 'micro-financial services era' and begin to deal with 'vulnerable households with complex livelihoods and varied needs'1, do we have a clear idea about the kinds of financial products that will be required or of the institutions that are going to deliver them? Do we have even a real sense of what 'financial services' mean for poor households? This note attempts to define the characteristics of good microfinance products.




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Rutherford,Stuart Edward

Raising the curtain on the "microfinancial services era" : Comienza la "era de los servicios microfinancieros" (Spanish). CGAP focus note ; no. 15 Washington, D.C. : World Bank Group.