"Microfinance:Credit Lending Models" is an attempt to document the various models currently being used by microfinance institutions throughout the world. |
A total of 14 models are described below. They include, associations,
small business, and
village banking models.
In reality, the models are loosely related with each other, and most good and sustainable microfinance institutions have features of two or more models in their activities.
Many of these models are in deed "formalized" versions of informal financial systems. Informal systems have historical precedents that predate modern banking systems. They are still in existence today used mostly by low-incoe households who do not have access to formal banks. GDRC has developed a continuum of informal credit suppliers that clearly illustrates the link between such informal systems and the models illustrated below.
The models were developed through extensive field work/observations and interviews carried out in India, Thailand, Philippines, Indonesia and Sri Lanka, and includes information from literature as well.