The Environmental Colours of Microfinance

Microfinance and Community Development
The availability of adequate and timely microfinance services for low-income households has many effects on the development of a community. It can directly effect community organizing and development as a part of the microfinance activities, and it can also indirectly enable and facilitate community development as an externality of credit itself.

Microfinance therefore enables collective action, the coming together of the community which is an important ingredient of participation of the community in its development. Formal and informal education and training are also enabled - for leaders and other members of the community in skills that will allow them to locally design, develop and manage community projects.

The enablement also has wide effects on environmental development. This can be seen in greater awareness of the community in its internal potentials, in its ability to interact together to solve its own problems. It also illustrates the power of local decision-making process that take place at the level of the community.

|  Community Development  |  Poverty  |  Microenterprises  |  Women   |  Macrofinance  |

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Hari Srinivas - hsrinivas@gdrc.org
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