Innovative Microfinance: Potential for Serving Rural Markets Sustainably

Open Access


Providing sustainable financial services for rural areas and agriculture in developing countries has proven immensely challenging. Billions have been spent to subsidize programs and policies designed to develop financial institutions to serve this neglected market segment. However many of the sector’s decision makers and analysts continue to be dissatisfied with the progress.


Interest Rate Financial Service Smart Card Credit Union Loan Portfolio 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.


  1. Adams, D.W., Graham, D.H., von Pischke, J.D. (eds.) (1984) Undermining Rural Development with Cheap Credit. Westview Special Studies in Social, Political and Economic Development series. Boulder CO, and London: Westview Press.Google Scholar
  2. Alamgir, D.A.H. (2009) Microfinance in SAARC Region: Review of Microfinance Sector of Bangladesh. Unpublished paper, Dhaka, Bangladesh.Google Scholar
  3. Armendariz, B., Morduch, J. (2005) The Economics of Microfinance, Cambridge: The MIT Press.Google Scholar
  4. Berger, E. (2009) Expanding Outreach in Malawi: OIBM’s Efforts to Launch a Mobile Phone Banking Program. Washington DC: SEEP Network.Google Scholar
  5. Brune, L., Giné, X., Goldberg, J., Yang, D. (2011) Commitments to Save: A Field Experiment in Rural Malawi. Unpublished paper, Ford School of Public Policy and Department of Economics, University of Michigan.CrossRefGoogle Scholar
  6. Brusky, B. (2007) Financial Cooperatives in Rural Finance: SICREDI, Brazil. Agricultural and Rural Development Internal Paper. Washington DC: World Bank.Google Scholar
  7. Buchenau, J., Meyer, R.L. (2007) Introducing Rural Finance into an Urban Microfinance Institution: The Example of Banco Procredit, El Salvador. Paper presented at the International Conference on Rural Finance Research: Moving Research Results into Policies and Practice. FAO, Rome, March 19–21, 2007.Google Scholar
  8. Campion, A., Ekka, R.K., Wenner, M. (2010) Interest Rates and Implications for Microfinance in Latin America and the Caribbean. Washington DC: Inter-American Development Bank.Google Scholar
  9. Chen, G., Rasmussen, S., Reille, X. (2010) Growth and Vulnerabilities in Microfinance. Focus Note 61, Washington DC: CGAP.Google Scholar
  10. Churchill, C. (1999) Client-Focused Lending: The Art of Individual Lending. Toronto: Calmeadow.Google Scholar
  11. Christen, R.P., Rosenberg, R., Jayadeva, V. (2004) Financial Institutions with a Double Bottom Line: Implications for the Future of Microfinance. Occasional Paper No. 8. Washington DC: CGAP.Google Scholar
  12. Conning, J., Udry, C. (2007) Rural Financial Markets in Developing Countries. In: Evenson, R., Pingali, P. (eds.) Handbook of Agricultural Economics, vol. 3: Agricultural Development: Farmers, Farm Production and Farm Markets. Amsterdam: Elsevier B.V., pp. 2857–2908.Google Scholar
  13. Consultative Group to Assist the Poor (CGAP) (2010) Financial Access 2010: The State of Financial Inclusion through the Crisis. Washington DC.Google Scholar
  14. Coulter, J. (2009) Review of Warehouse Receipt Systems and Inventory Credit Initiatives in Eastern & Southern Africa. A working document for comment commissioned by UNCTAD, under the All ACP Agricultural Commodities Programme (AAACP), September 25, 2009.Google Scholar
  15. Dellien, H., Burnett, J., Gincherman, A., Lynch, E. (2005) Product Diversification in Microfinance: Introducing Individual Lending. New York: Women’s World Banking.Google Scholar
  16. Food and Agriculture Organization of the United Nations (FAO) and Deutsche Gesellschaft für Technische Zusammenarbeit (GTZ) (1998) Agricultural Finance Revisited: Why? Agricultural Finance Revisited Monograph 1, Rome, June 1998.Google Scholar
  17. Gine, X., Goldberg, J., Yang, D. (2010) Identification Strategy: A Field Experiment on Dynamic Incentives in Rural Credit Markets. Unpublished paper. Washington DC: World Bank.Google Scholar
  18. Gómez Soto, F., González-Vega, C. (2006) Formas de Asociación Cooperativa Y su Participación en la Provisión de Servicios Financieros en las Áreas Rurales de México. Proyecto AFIRMA, USAID, México.Google Scholar
  19. Gonzalez, A. (2007) Efficiency Drivers of Microfinance Institutions (MFIs): The Case of Operating Costs. MicroBanking Bulletin 15:37–42.Google Scholar
  20. Gonzalez, A. (2010) Is Microfinance Growing Too Fast? MIX Data Brief No. 5, Washington DC: MIX Market.Google Scholar
  21. Gonzalez, A. (2010) Microfinance Synergies and Trade-offs: Social versus Financial Performance Outcomes in 2008. MIX Data Brief No. 7. Washington DC: MIX Market.Google Scholar
  22. Gonzalez-Vega, C. (1984) Credit-Rationing Behavior of Agricultural Lenders: The Iron Law of Interest-Rate Restrictions. In: Adams, D.W., Graham, D.H., vonGoogle Scholar
  23. Pischke, J.D. (eds.) Undermining Rural Development with Cheap Credit. Westview Special Studies in Social, Political and Economic Development series. Boulder CO and London: Westview Press, pp. 78–95.Google Scholar
  24. Harper, M. (2011) Taking Stock: Agrarian distress in India – poor Indian farmers, suicides and government. Enterprise Development and Microfinance 22(1): 11–16.CrossRefGoogle Scholar
  25. Hazell, P., Anderson, J., Balzer, N., Hastrup Clemmensen, A., Hess, U., Rispoli, F. (2010) Potential for Scale and Sustainability in Weather Index Insurance for Agriculture and Rural Livelihoods. International Fund for Agricultural Development and World Food Programme, Rome.Google Scholar
  26. Hirschland, M., Chao-Béroff, R., Harper, M., Lee, N. (2008) Financial Services in Remote Rural Areas: Findings from Seven Member-Owned Institutions. Nova Scotia, Canada: Coady International Institute, Antagonism.Google Scholar
  27. Hoff, K., Stiglitz, J.E. (1990) Introduction: Imperfect Information and Rural Credit Markets-Puzzles and Policy Perspectives. The World Bank Economic Review 4(3):235–250 (A Symposium Issue on Imperfect Information and Rural Credit Markets).Google Scholar
  28. Höllinger, F. (2004) Financing Agricultural Term Investments, Agricultural Finance Revisited No. 7. Rome: FAO/GTZ.Google Scholar
  29. International Fund for Agricultural Development (IFAD) (2010) IFAD Decision Tools for Rural Finance. Rome: IFAD.Google Scholar
  30. Jia, X., Heidhues, F., Zeller, M. (2010) Credit Rationing of Rural Households in China. Agricultural Finance Review 70(1).Google Scholar
  31. Kalanda, A.-A., Campbell, B. (2008) Banking Rollout Approaches to Rural Markets: Opportunity International Bank of Malawi. Opportunity International, White Paper, No. 8.Google Scholar
  32. Ledgerwood, J., White, V. (2006) Transforming Microfinance Institutions: Providing Full Financial Services to the Poor. Washington DC: World Bank.CrossRefGoogle Scholar
  33. McGuinness, E. (2008) Malawi’s Financial Landscape: Where Does Opportunity International Bank of Malawi Fit? Microfinance Opportunities, Washington DC.Google Scholar
  34. Meyer, R.L. (2002) The Demand for Flexible Microfinance Products: Lessons from Bangladesh. Journal of International Development 14(3):351–368.CrossRefGoogle Scholar
  35. Meyer, R.L. (2011) Subsidies as an Instrument in Agricultural Development Finance: Review. Joint Discussion Paper of the Joint Donor CABFIN Initiative. Washington DC.Google Scholar
  36. Meyer, R.L., Nagarajan, G. (2000) Rural Financial Markets in Asia: Policies, Paradigms, and Performance. Manila, Philippines: Oxford University Press and Asian Development Bank.Google Scholar
  37. Meyer, R.L., Roberts, R., Mugume, A. (2004) Agricultural Finance in Uganda: The Way Forward. FSD Series No. 13. Kampala, Uganda: Bank of Uganda/GTZ/ Sida Financial System Development Programme and KfW.Google Scholar
  38. Morduch, J. (1999) The Role of Subsidies in Microfinance: Evidence from the Grameen Bank. Journal of Development Economics 60(1):229–248.CrossRefGoogle Scholar
  39. Nagarajan, G. (2010) Money in a Pot: Has OIBM Altered Savings in Rural Malawi? Notes from the Field, IRIS Center, University of Maryland, July 2010.Google Scholar
  40. Nagarajan, G., Adelman, S. (2010) Does Intense Marketing Increase Outreach? The Case of Opportunity International Bank in Rural Malawi. IRIS Center, University of Maryland.Google Scholar
  41. Nair, A., Kloeppinger-Todd, R. (2007) Reaching Rural Areas with Financial Services: Lessons from Financial Cooperatives in Brazil, Burkina Faso, Kenya, and Sri Lanka. Agriculture and Rural Development Discussion Paper 35. Washington DC: World Bank.Google Scholar
  42. Navajas, S., Gonzalez-Vega, C. (2003a) Financiera Calpia, El Salvador: Innovative Approaches to Rural Lending. In: Wenner, M.D., Alvarado, J., Galarza, F. (eds.) Promising Practices in Rural Finance: Experiences from Latin America and the Caribbean. Washington DC: Inter-American Development Bank, pp. 177–211.Google Scholar
  43. Navajas, S., Conning, J., Gonzalez-Vega, C. (2003b) Lending Technologies, Competition and Consolidation in the Market for Microfinance in Bolivia. Journal of International Development 15:747–770.CrossRefGoogle Scholar
  44. Opportunity Blog (2010) Microfinance Loan Officers Go Green with Electronic Bikes. November 12, 2010.…/microfinance-loan-officersgo-green-with-electronic -bikes/.
  45. Opuku, L., Foy, D. (2008) Pathways out of Poverty: Innovative Banking Technologies to Reach the Rural Poor. Enterprise Development and Microfinance 19(1):46 – 58.CrossRefGoogle Scholar
  46. Paxton, J. (2007) Contrasting Methodologies Used to Expand the Outreach of Financial Services to the Rural Poor: Lessons from Mexico’s PATMIR Experience. Paper presented at the International Conference on Rural Finance Research: Moving Research Results into Policies and Practice. FAO, Rome, March 19–21, 2007.Google Scholar
  47. Porteous, D. (2006) Competition and Microcredit Interest Rates. Focus Note 23. Washington, DC: CGAP.Google Scholar
  48. Qayyum, A., Ahmad, M. (no date) Efficiency and Sustainability of Micro Finance Institutions in South Asia. Unpublished paper, Pakistan Institute of Development Economics (PIDE).Google Scholar
  49. Rhyne, E. (2001) Commercialization and Crisis in Bolivian Microfinance. USAID Microenterprise Best Practices. Washington DC.Google Scholar
  50. Roberts, R., Ocaya, R. (2009) Agricultural Finance Yearbook 2009. Kampala, Uganda: Bank of Uganda and Plan for the Modernization of Agriculture.Google Scholar
  51. Rosenberg, R. (2010) Does Microcredit Really Help Poor People? Focus Note 59. CGAP.Google Scholar
  52. Seibel, H.D. (2003) Centenary Rural Development Bank, Uganda: a flagship of rural bank reform in Africa. Small Enterprise Development 14(3):35–46.CrossRefGoogle Scholar
  53. Vogel, R.C. (2005) Costs and Benefits of Liquidating Peru’s Agricultural Bank. Washington DC: USAID.Google Scholar
  54. von Pischke, J.D., Donald, G., Adams, D.W. (eds.) (1983) Rural Financial Markets in Developing Countries: Their Use & Abuse. Baltimore: Johns Hopkins University Press.Google Scholar
  55. WOCCU (2010) Program Brief: Mexico. June 2010.Google Scholar
  56. Woller, G. (2002) From Market Failure to Marketing Failure: Market Orientation as the Key to Deep Outreach in Microfinance. Journal of International Development 14(3):305–324.CrossRefGoogle Scholar
  57. World Bank (1989) World Development Report 1989: Financial Systems and Development. New York: Oxford University Press.CrossRefGoogle Scholar
  58. World Bank (2003) Rural Financial Services: Implementing the Bank’s Strategy to Reach the Rural Poor. Report No. 26030. Washington DC: World Bank.Google Scholar
  59. World Bank (2007) Providing Financial Services in Rural Areas: A Fresh Look at Financial Cooperatives. Washington, DC: World Bank.Google Scholar
  60. Wright, G.A.N. (2000) Microfinance Services: Designing Quality Financial Services for the Poor. Dhaka: The University Press Limited.Google Scholar
  61. Wright, G.A.N., Rippey, P. (2003) The Competitive Environment in Uganda: Implications for Microfinance Institutions and Their Clients. MicroSave.Google Scholar
  62. Yaron, J. (1992) Assessing Development Finance Institutions: A Public Interest Analysis. World Bank Discussion Paper No. 174, Washington, D.C: World Bank.Google Scholar
  63. Yaron, J., Benjamin, Jr., M.P., Piprek, G.L. (1997) Rural Finance: Issues, Design, and Best Practices, Environmentally and Socially Sustainable Development Studies and Monographs Series 14. Washington DC: World Bank.Google Scholar
  64. Zacharias, J. (2008) An Investigation of Economies of Scale in Microfinance Institutions. Unpublished paper. The Leonard N. Stern School of Business, Glucksman Institute for Research in Securities Markets.Google Scholar
  65. Zeitinger, C.P. (2005) Incentive Schemes for Employees of ProCredit Banks. ProCredit Holding News.Google Scholar
  66. Zeller, M. (2006) A Comparative Review of Major Types of Rural Microfinance Institutions in Developing Countries. Agricultural Finance Review 66(2):195–213 (Special Issue).CrossRefGoogle Scholar

Copyright information

© The Author(s) 2014

Open Access This chapter is distributed under the terms of the Creative Commons Attribution Noncommercial License, which permits any noncommercial use, distribution, and reproduction in any medium, provided the original author(s) and source are credited.

Authors and Affiliations

  1. 1.Ohio State UniversityColumbusUSA

Personalised recommendations