All posts tagged: small business

Micro-finance Explained : A Sneak Peek into the World of Micro-finance

Micro-finance has become a buzzword in the social sector and viewed as a silver bullet for eradicating poverty. This column is designed to help you gain some basic knowledge on micro-finance, it’s role in poverty alleviation and the current happenings in this space. What is Micro-finance? Micro-finance refers to providing financial services – credit and savings ‐ to the poor who are running small businesses or would like to start one and are in need of capital. Small loans for small businesses, with focus on providing credit is the way the industry has evolved over the past 30 years. In our world it’s relatively easy to obtain credit, we have banks who are more than eager to give loans however on the other hand banks are reluctant to service the poor as they often do not have the required collateral and are considered high-risk by any self respecting bank. With the banking system out of their realm, the poor (earning less than $2 a day) often fall prey to private moneylenders who loan at high …