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Can Technical Service Providers Add Significant Value?

Guest post by: United Nations Capital Development Fund

Article Overview: The second major hypothesis behind MicroStart is that technical assistance from an experienced microfinance organization or consulting firm can help build the capacity of small, young MFIs.

Can Technical Service Providers Add Significant Value?

The second major hypothesis behind MicroStart is that technical assistance from an experienced microfinance organization or consulting firm can help build the capacity of small, young MFIs. This broad hypothesis begins where the former discussion leaves off, with the observation that the organizations that show vision, leadership, and a willingness to learn are the ones where technical support is most likely to add substantial value. This section deals mainly with a different question -- whether the technical service providers are able to offer good value, particularly within MicroStart's operational framework.

Our general conclusion is that TSPs have a great deal of specific, relevant knowledge to offer, as evidenced by our observation that nearly all of the MFIs are implementing important changes as a result of participation in MicroStart. Involvement in MicroStart may also be important for the TSPs, especially those that are retail MFIs, in helping them to develop their capacity to provide assistance. It is still too early to make generalizations about the effectiveness and impact of the relationships. However, it is not too soon to begin examining the nature of the relationships that are being established and the factors that make them work well.

MicroStart: Finding and Feeding Breakthroughs
Midterm Evaluation
Prepared for UNCDF/SUM
10 December 1999
Elisabeth Rhyne and Jill Donahue

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Article Tags: consulting firm, elisabeth, generalizations, hypothesis, jill donahue, mfis, microfinance, microstart, observation, operational framework, participation, relationships, relevant knowledge, substantial value, technical assistance, technical service providers, technical support, tsps, vision leadership, willingness



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