Further explanation from the United Nations, who declared 2005 the International Year of Microcredit: If microfinance is about serving the poor, why does the provision of financial services need to be profitable?
Microfinance institutions need to be profitable in order to cover the costs of reaching out and meeting the demand of underserved segments of the population over a sustained period of time. Additionally, after a series of very small loans, a microentrepreneur often wants to expand her business; a microfinance institution must keep up with the demand for larger loan amounts so businesses can grow into small enterprises.
Related Questions
- Further explanation from the United Nations, who declared 2005 the International Year of Microcredit: If microfinance is about serving the poor, why does the provision of financial services need to be profitable?
- What is a detailed explanation of Googles international tax minimization strategy?
- What is FINCA International?
