What are microfinance institutions (MFIs)?
MFIs are specialized organizations offering credit schemes for microentrepreneurs. In many cases they also provide additional financial services such as savings and insurance. MFIs operate locally and are staffed with local people who evaluate and support the MFI’s customers and build close relationships of trust with local microentrepreneurs. This is one of the reasons why microentrepreneurs are reliable customers. Experience shows that up to 97 percent of microentrepreneurs repay their loan installments on time. Customers often take up additional microcredits to further develop their business.
