Tweet

Recommendations for future research - Factors Impeding the Poverty Reduction Capacity of Micro-credit: Some Field Observations from Malawi and Ethiopia

Written by: African Development Bank

Article Overview: In light of the conclusions drawn above, there is a need for further policy and action oriented research and in-depth investigation. First and foremost, there is a need for extensive empirical evidence to verify and ascertain the capabilities of micro-credit in reducing the depth and scope of poverty.

Recommendations for future research - Factors Impeding the Poverty Reduction Capacity of Micro-credit: Some Field Observations from Malawi and Ethiopia

In light of the conclusions drawn above, there is a need for further policy and action oriented
research and in-depth investigation. First and foremost, there is a need for extensive empirical
evidence to verify and ascertain the capabilities of micro-credit in reducing the depth and scope
of poverty. Specific attention, investigation and analysis needs to be given to the characteristics
of micro-credit delivery mechanisms and strategies that are in existing practice. In this, there is a
need to investigate and identify innovative approaches to micro-credit delivery that will reduce
poverty sustainably. In addition, there is a need to analyse the features and characteristics of
micro-credit within a gender and empowerment framework, and to question the extent to which
access to credit and income generated thereof gives women in rural Africa the power and confidence
to negotiate gender sensitive division of labour, roles, authority and decision-making autonomy.
Furthermore, based on the observation that profit oriented MFIs have a better outreach in the
rural areas, there is a need to further investigate and integrate poverty reduction mechanisms and
strategies within existing MFI structures. In this regard, further investigation can be carried out to
establish viability of means and ways to place greater demonstrated accountability for social and
economic poverty reduction on the MFI together with the government.
On a more macro level there is a need to analyse the poverty reduction and economic growth
trade-off when targeting the ‘not-so-poor’ versus targeting the ‘poorest of the poor’ within the
micro-credit industry and framework. In this, specific attention can be given to the debate on
providing relief and/ or grants to achieve meaningful poverty reduction.
Last but not least, there is a need to identify possibilities of merging the positive aspects of
commercial banking, such as the comparatively lower interest rates, with the advantages offered
by the MFI, such as satisfying the needs of the micro-borrower, whereby allowing borrower to
have maximum benefit in the process of poverty reduction. Therefore, empirical evidence and
case studies analysis should be carried out to understand clearly the differences and similarities of
these two forms of institutions and where they can come together for effective poverty reduction
and empowerment of the poor.

ECONOMIC RESEARCH PAPERS
NO 74
(January 2003)
Factors Impeding the Poverty Reduction Capacity of Micro-credit: Some Field Observations from Malawi and Ethiopia
by
Sunita Pitamber

Related Articles
  Savings Mobilisation: Tenets of Micro-credit for Poverty Reduction
  Abstract - Factors Impeding the Poverty Reduction Capacity of Micro-credit: Some Field Observations from Malawi and Ethiopia
  Group Mobilisation: Tenets of Micro-credit for Poverty Reduction
  Micro-finance Policy and Development Framework: Malawi
  Introduction - Abstract - Factors Impeding the Poverty Reduction Capacity of Micro-credit: Some Field Observations from Malawi and Ethiopia

Article Tags: accountability, autonomy, conclusions, credit delivery, delivery mechanisms, depth investigation, division of labour, economic growth, economic poverty, empirical evidence, empowerment, macro level, mfi, micro credit, outreach, poverty reduction, reduction mechanisms, rural areas, sustainably, viability



Related Forum Posts
Nana excercise - Nana > answer the following: 1. If you had no chance of failure what would you dream to be your ideal Job or Business? 2. What about this dream excites you? 3. What Field of Study (Major) will get you closer to this dream? 4. What other Field of Study would "compliment" (Minor) your dream to get you closer to it. REMEMBER: there is no wrong answer. I'm hoping this exercise will help place you in a program that makes you excited at a "most probable likely" future. Your answers will help open a dialogue on the forum.
Re: 15 Ways You Can Look Amazing on LinkedIn - Recommendations sent for... Evan, Alan, Michelle. I'll get to the rest of you eventually, I promise!
Re: My Favorite Book For Entrepreneurs In 2010 - Lead The Field. By Earl Nightingale. I have read the book more than 7 times, since I bought it in 2008
Re: What or Who Sparks Your Business Interest - this might be surprise to you, but poverty spark my business interest. Poverty is prevalent in Africa. And I discovered early in life that people that own their businesses are richer than anypne else. I decided to get out of the poverty level and business provided a way of escape.
Re: 15 Ways You Can Look Amazing on LinkedIn - [quote="Trent Brownrigg":21rorzqk]Recommendations sent for... Evan, Alan, Michelle. I'll get to the rest of you eventually, I promise![/quote:21rorzqk] Thanks Trent, I left you a message there. Evan thank you I have accepted your invitation. MichelleJ


Share this article with your friends. Fund someone's dream.

Leave a comment below or share on the left and you'll help support entrepreneurs in Africa through our partnership with Kiva. Over $50,000 raised and counting - Please keep sharing! Learn more.

Tweet

Newsletter

Get advice & tips from famous business
owners, new articles by entrepreneur
experts, my latest website updates, &
special sneak peaks at what's to come!

Name:
Email:

Popular Articles

Maximum Impact Restaurant Greening

How do you keep it together on a daily basis?

What I Really Want Is...

Suggestions

Email us your ideas on how to make our
website more valuable! Thank you Sharon
from Toronto Salsa Lessons / Classes for
your suggestions to make the newsletter
look like the website and profile younger
entrepreneurs like Jennifer Lopez.