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Unlock the transformative power of microfinance for global poverty reduction.This insightful title explores how to build inclusive financial systems that empower the poor and drive economic growth in developing countries.Drawing on a decade of CGAP experience, it offers a comprehensive framework for expanding access to financial services for all.

In Russia, small-scale entrepreneurship has emerged in response to the collapse of state-ownership and unemployment in the early 1990s. Small businesses typically lack adequate collateral and credit history, making them “unbankable” by the mainstream financial sector. To fund their businesses, micro-entrepreneurs are forced to rely on funds from family and friends, or money lenders. Microfinance institutions of four types have emerged to meet the unfulfilled financing needs of micro-entrepreneurs: commercial banks, specialized NGO-type microfinance institutions, membership-based institutions (such as rural cooperatives and credits unions), and public funds. All four types have enjoyed significant growth in Russia in the past five years, but the industry is still at an early stage of development. Demand appears to far outweigh supply. Microfinance in Russia provides an overview of microfinance in Russia to date, presenting industry trends and identifying key challenges to sustainable growth of the industry.

This book focuses on how the demand for microfinance can be met on a global scale. It documents the contributions of institutions and of people who have led the development of commercial finance for the poor, and it analyzes the principles on which the microfinance revolution is based. In sum, this work offers a detailed overview of the development of microfinance over the past 20 years; a global view of microfinance in the developing world (largely excluding Eastern Europe); a thesis on the future path of microfinance; a coherent theory about microfinance--why it works when so many other development interventions fail; detail on a number of important microfinance topics--such as informal moneylending and savings; an important study on, and lessons from Indonesia, with detailed analysis of Bank Rakyat Indonesia; and, brief studies of many other microfinance institutions in Africa, Asia, and Latin America.

This paper explores the factors influencing the sustainability of microfinance programmes in the OR Tambo Coastal District (ORTCD) in the Eastern Cape, South Africa. The paper questions whether the services offered to microfinance clients can facilitate loan repayment and the sustainability of microfinance programmes. Precisely, the paper examines how the combination of financial and non-financial services facilitates loan repayment and the sustainability of these programmes. In the study, the recipients of microfinance loans in the OR Tambo Coastal District of the Eastern Cape were interviewed about the services offered by microfinance institutions. The study adopted a qualitative research approach and collected data through semi-structured interviews with recipients of microfinance loans in ORTCD. The collected data was analysed thematically following Braun and Clarke’s six-step approach, ensuring that codes and themes emerged inductively from participants’ narratives. The obtained results revealed that loan repayment and programme sustainability are shaped by the interdependent role of financial services (loan type and loan size) and non-financial services (technical assistance and client-institutional relationships). However, weak institutional ties and limited monitoring threaten long-term programme outcomes. The study’s findings suggest that combining financial and non-financial services improves repayment capacity, institutional confidence, and sustainability, particularly in underserved rural communities. Therefore, the study recommends strengthening training frequency, establishing continuous client evaluation mechanisms, and integrating institutional perspectives to improve the sustainability of microfinance interventions.

The combination of digital technology and finance has brought about a new development model for financial inclusion. What impact will it have on the current imbalance in the distribution of financial resources and the urban-rural income gap in China? To answer this question, this paper uses relevant data from 2014–2018 to study the impact of digital inclusive finance on the urban-rural income gap from the theory of financial exclusion, and analyzes the transmission of digital inclusive finance through alleviating financial exclusion, widening financing channels and helping residents with entrepreneurial spirit to start their own businesses, thus increasing jobs, raising the income of rural residents and reducing the urban-rural income gap. The conclusions are as follows: (1) digital inclusive finance can significantly converge the urban-rural income gap; (2) among the dimensions of digital inclusive finance, only the breadth of coverage can significantly reduce the urban-rural income gap, while the effects of depth of use and digitalization are not significant; (3) digital inclusive finance can alleviate the urban-rural income gap through the transmission mechanism of promoting residents’ entrepreneurship; (4) the worse the regional economic development and education, the better the effect of digital inclusive finance on the urban-rural income gap. This paper combines the above results to propose corresponding policy recommendations.

In the last few years, considerable attention has been paid to microfinance as a relevant participant in the formal financial system, whose target audience is people who are otherwise at risk of financial exclusion. In parallel, sustainability and the promotion of Sustainable Development (SD) are imposed as the theoretical frame when facing any study. This, connected with cultural and organizational dimensions theories, are the analytical framework for the analysis of the relationship between the context of performance in which Microfinance Institutions (MFIs) operate and their activity in promoting sustainability. A holistic approach is necessary to make operational these concepts; for that reason, financial, environmental, social and governance dimensions (FESG), and the balance among them, have to be considered. The main objective of the paper is to explore to what extent MFIs are fostering SD, and how this promotion is performed by region. For the analysis, two different sources of information have been studied: sectoral academic literature that focuses on the different sustainability dimensions, and MIX Market sustainability data obtained from the MFIs. A keyword analysis of the selected papers has been executed to be conscious of the most investigated aspects by region; on the data provided by the institutions, a Kruskal-Wallis H test has been performed to learn what the main Sustainability Indicators (SIs) are that are reported affirmatively. To obtain comprehensive research, a comparative study of the results offers the convergences, divergences and gaps of information in each of the regions. The findings show significant differences depending on the region, and confirm that operationalization should be adjusted at the regional context of the MFIs. The paper, with the inherent limitations due to data quality, also offers recommendations for the better promotion of sustainability in each of the regions.

This study investigated the role of financial literacy in the relationship between women’s empowerment and green microfinance. We set a conceptual model with green microfinance as an outcome variable, financial literacy as a mediating variable, and women’s empowerment as an exposure variable. Variance-based SEM was employed for analysis. The results show that the exposure and mediating variables have a significant direct and indirect impact on the outcome variable. The relationship between women’s empowerment and green microfinance is partially mediated by financial literacy. Local wisdom-based financial literacy is found to be an alternative for mainstreaming women’s empowerment in local development. In addition, gender-targeted programs need to consider pro-literacy policies for achieving green microfinance sustainability. By using financial literacy as a mediating variable, this study contributes to the current literature on the relationship between women’s empowerment and green microfinance.

PurposeThis study aims to present a bibliometric analysis of Islamic social finance (ISF) by addressing gaps in the existing research, exploring the current trends of publications and determining possible future research directions in this field.Design/methodology/approachRelevant bibliometric data of published research during 1914–2022 was extracted from the Scopus database and 1,355 studies were considered for the analysis. Biblioshiny app from RStudio, VOSviewer and Microsoft Excel were the tools used for analysis.FindingsThe identified current research streams are management and distribution of ISF funds especially zakat through fintech; governance and accountability of ISF institutions; Islamic microfinance for poverty alleviation and financial inclusion; ISF for promoting sustainable development and achieving United Nations sustainable development goals; waqf endowments and cash waqf; and Islamic charities. The identified themes for future research directions are Islamic fintech, integration of ISF, sustainable development, economic recovery, social entrepreneurship, sustainable ISF ecosystem and supporting refugees.Practical implicationsIt provides extensive and up-to-date literature on the current trends in ISF and future research themes which can be useful for researchers, professionals and policymakers in the field.Social implicationsThe findings of this research contribute to the solutions to socio-economic challenges and support sustainable development through ISF.Originality/valueTo the best of the authors’ knowledge, this research is one of the first attempt to provide a pervasive bibliometric review on ISF by including various aspects of ISF and extending the study period to more than 100 years.

A key insight from research on hybrid organizing is that the joint pursuit of competing goals exposes an enterprise to potentially problematic tensions and trade-offs. Yet while studies have examined the former, the actual trade-offs that these organizations face—and how these might vary among enterprises and contexts—has been largely overlooked. Focusing on social enterprise, we address these gaps by (1) developing a framework that can be used to predict the compatibility of social outreach and financial sustainability for different types of enterprises and (2) arguing that the acuteness of trade-offs will vary based on the cultural roots of the issue an enterprise addresses, the market conditions where it operates, and the quality of its management. We test our arguments by studying 2,037 microfinance organizations in 115 nations between 1995 and 2013. Results support our predictions. Social–financial trade-offs are amplified when a social issue is intertwined with deep-seated cultural problems, such as discrimination, and when an enterprise operates in a weak institutional environment. Intensive social outreach becomes sustainable, however, when cultural barriers to outreach are low, market-supporting institutions are strong, and an enterprise is professionally managed. Our study thus shows that social–financial trade-offs are contingent and that the promise of sustainable social outreach varies widely across contexts. The e-companion is available at https://doi.org/10.1287/orsc.2017.1188 .

Sustainable Development Goals (SDGs) highlight the importance of poverty reduction, and call for policy implementation that leads to the socio-economic development of impoverished people. However, there is a lack of knowledge about assessing individual-level socio-economic development, and how financial inclusion through microfinance can contribute to it. Therefore, the role of commercially operated Microfinance Banks (MFBs) is also considered to be controversial in the literature. This study assesses the overall socio-economic development by considering different sustainable livelihoods, multidimensional poverty, living standards, and social development measures. Thus, the Multidimensional Poverty Index (MPI), and Living Standard Index (LSI) have been estimated to gauge poverty and improvements in living standards. Data comprising 503 customers of MFBs, and 500 control respondents, has been gathered through a survey to signify this impact for two years. This paper substantiates that the microfinance obtained from MFBs contributes positively towards sustainable livelihoods, multidimensional poverty reduction, and living standards. However, microfinance does not contribute to social development. Impoverished people, mainly women living in urban areas, reap more benefits from microfinance, than their rural counterparts. Overall, financial inclusion shall be a gateway to achieve the SDGs in the long run through the socio-economic development of an impoverished segment of the society.