The paradigm for microfinance championed by members of the WWB network has at its core that: a) microfinance services should focus on the poor; b) microfinance services and institutions must be sustainable, once operations have grown to a reasonable scale; and c) microfinancing institutions need to be integrated into the domestic financial system through savings and/or accessing commercial funds.

Members of the WWB network define successful microfinance institutions as those that:

  • provide financial services to significant numbers of poor people.
  • provide microfinance services that are efficient and financially sustainable.
  • provide services that have a high impact on reducing the poverty of clients.
  • are integrated into the domestic financial systems, through savings mobilization and through mobilizing funds from commercial sources.

Three key measures to provide responsive and sustainable financial services to hundreds of millions of poor entrepreneurs are:

  • engaging a range of institutional types;
  • focusing on achieving high performance by a range of legal structures;
  • providing favorable policies and financial access to institutions with high performance.

Microfinance Policy Focus

Range of institutions

To reach the hundreds of millions of poor people that need and warrant access to financial services, microfinance NGOs, other specialized microfinance institutions, commercial banks, credit unions and cooperatives, and grassroots savings and credit programs need to participate.


The key is not legal structures, but the demonstrated capacity of the microfinance institution to meet high standards of operating and financial performance, reach, client impact, and integration into the domestic financial system.

Favorable Policies, Support

Those institutions that meet high standards warrant a favorable policy environment and financial support, including capital, loan funds, practitioner-based institutional development support, and the capacity to mobilize savings.

Source: Women's World Banking
Hari Srinivas -
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