What is the role of World Bank in promoting microcredit? How effective are its initiatives?
The World Bank loves to talk about microcredit. It set up a division called the Consultative Group to Assist the Poor (www.cgap.org) that publishes extensive information about microfinance. Unfortunately, the World Bank puts very, very little actual funding into microfinance. It should do more. Is there anything that corporates can do for promoting microcredit? Oh yes. They can help and it will ultimately improve their businesses as well. It is good corporate citizenship to help reduce poverty in the community where you conduct your regular business. Plus, as you reduce poverty, you increase the number of potential future customers as well. Imagine if you were a regular bank, how could you grow your business? A well run bank has many strategies to increase business, but now several Indian banks have a new and very progressive thought: win new customers from those who are currently unbankable. By helping people who have never had financial services get them, some will continue advancing
