10.1 Microfinance institutions in developing countries, after several years of operation, can achieve the economies of scale that allow them to cover their operating and financial costs, sustaining their program without any additional subsidies. However, the microfinance industry at present requires seed capital in the form of grants and concessional loans in order to establish and scale-up the institutions necessary t achieve the Summit goal. The microcredit campaign therefore will need different types of financial support, commercial rate lending, and equity investments by commercial banks and financial institutions.

10.2 Grants and donations are needed to start new microcredit institutions and to see them through the early years of the growth curve. They are needed to establish initial loan funds and to subsidize salaries and training programs for staff until sufficient interest income is generated to allow the institution to support itself. (See endnote #2) In addition to the grant monies needed for the microcredit institutions themselves, there must be funds for creating infrastructure. The most obvious sources for this type of assistance are multilateral and bilateral aid programs and national and local governments. Other sources are private donors, grantmaking organizations, service clubs, schools, religious organizations and corporations.

10.3 Loans to microcredit programs at subsidized rates (one to three percent) from international financial institutions (e.g. the World Bank and the regional developmentbanks) and private socially conscious investors will be important for fueling rapid growth of loan portfolios in the early and middle stages of a microcredit institution s development. These funds help to underwrite a transitional period during which the young institution will be moving toward sustainability but still in need of special support. The use of soft loans will provide an environment of business discipline, along with funds needed to allow the loan portfolios to grow more rapidly than would otherwise be possible.

10.4 Guarantees are a way for donor agencies and institutions to make efficient use of their limited resources by stimulating a flow of credit from financial markets into microcredit programs. Their use is a good interim measure for microcredit institutions in the process of moving from the nonprofit sector into the commercial. These microcredit programs benefit from the assistance of donor extended guarantees while they adjust to the discipline of financial market requirements.

10.5 Market rate loans to microcredit programs from commercial sources will be essential for fueling the expansion of those programs who have achieved sufficient scale to reach economic viability.

11.1 Key to the mobilization and organization of funding will be a global system of microfinance funds. The Consultative Group to Assist the Poorest (CGAP) (see endnote #3), a multi-donor effort headed by the World Bank to address poverty through microfinance, can play a vital role in persuading donors and financial institutions to cooperate in creating microfinance funds on global, regional, national and sub-national levels. CGAP, paying particular attention to the recommendations of its Policy Advisory Group (see endnote #4), should develop the organizational framework and operational guidelines for the funds. A global fund may be created at the World Bank; regional funds can be created either as independent entities or as part of regional development banks. These funds can offer grant and equity financing as well as soft loans to the national microfinance funds. They can act as guarantors for loans from commercial sources, and promote various instruments for capital markets in order to raise funds for the national microfinance funds. National microfinance funds can then offer similar services to the grassroots microcredit programs themselves.

11.2 The CGAP's Policy Advisory Group has recommended a set of eligibility criteria for use in determining which microfinance institutions should receive CGAP funds. These guidelines may serve as a blueprint for the microfinance funds to use as well. These eligibility criteria assert that CGAP discretionary funds should be used to finance:

1. Locally-controlled institutions that have demonstrated the commitment and the capacity to provide financial services to significant numbers of people and that have methods in place or to be tested to reach the very poorest (see endnote #5). Priority will be given to institutions that have already demonstrated the capacity to reach the poorest.
2. Local institutions that have reached operational self-sufficiency and that are moving on a path to financial self-sufficiency. (In countries where constraints have prevented institutions from meeting this criteria, CGAP could support institutions that are on a clear path to operational self-sufficiency).
3. Local institutions that are providing savings services to the very poor or are moving in the direction of providing these services.
4. Governance structures that include ownership and participation in decision-making by clients will be encouraged.
5. Local institutions with the capacity to mobilize domestic savings, lending and/or investment resources to expand microfinance operations, and to utilize external funding to leverage domestic finance will be encouraged (rather than employing any mechanical matching fund criteria).

12.1 The access to conventional financial markets that will fuel the rapid growth of microfinance is a complex process that requires the best efforts of both experienced practitioners of microcredit and the leading managers in mainstream finance. The Summit seeks to provide a stage on which to educate both the natural stakeholders in microfinance and key leaders of the financial sector about the substantial progress that is being made toward the marriage of microcredit and conventional financial markets. The following initiatives, already in existence, are promising indicators.

12.2 Involvement of national banking systems

Some microfinance programs borrow funds from commercial banks to on-lend to their clients. Many microenterprise programs currently fund their portfolios by accessing the local banking markets as corporate customers, subject to all the normal conditions. In many cases, their performance has matched or exceeded that of traditional credit. Thus, microcredit programs no longer rely exclusively on grants or external donations for their operations.

12.3 Creation of specialized financial institutions within national banking systems. When growth has gone beyond the capacity of local banks to service the microenterprise program as a client, some of these organizations have established fully-fledged financial institutions regulated by the Superintendency of Banks, no different from other banks except for one thing: they are exclusively dedicated to microenterprise. This has already happened in Asia (Grameen Bank in Bangladesh, Bank Dagang Bali in Indonesia); Latin America (BancoSol in Bolivia, Finansol in Colombia); and is now happening in Africa (K-Rep in Kenya). In some cases, conventional banks have established successful microenterprise operations (e.g. Bank Rakyat, Indonesia; Multicredit Bank, Panama; Banco del Desarollo, Chile).

When microcredit programs make the transition to formal financial institutions they can have a dramatic impact. For instance, the entire Bolivian banking system serves a total of 167,000 clients, of which 63,000 (or nearly 40%) belong to BancoSol. Attractive economic performance has also been proven, as shown by BancoSol's return on assets of 2.2% in 1994, the highest in the entire Bolivian banking system.

12.4 Mobilization of savings from the microenterprise population. The enormous potential of savings in this sector has been demonstrated by, among others, the experience in Indonesia (Bank Rakyat, Bank Dagang Bali), Bangladesh (Grameen Bank), and Bolivia (BancoSol).

12.5 Issue of debt instruments through national securities exchanges. Successful issue of paper into local capital markets by microenterprise specialists that are not formal financial institutions has been demonstrated in 1995 in Paraguay by the NGO Fundacion Paraguay de Cooperacion y Desarollo, with an issue of $150,000.

12.6 Placement in international markets of financial instruments issued by microfinance institutions. Certificates of Deposit of BancoSol have been placed in the U.S. and French markets to premier financial institutions on a strictly commercial basis. Thus, the world's most sophisticated capital markets have actually been linked with the promise to pay of a woman microentrepreneur selling her wares on a street corner in La Paz. Closing this conceptual loop is a true landmark in the development of microenterprise finance.

12.7 The securitization of microenterprise loan portfolios. In Ecuador, a model is being deployed to issue into local financial markets commercial paper backed by microenterprise loan portfolios. This is scheduled to be implemented by 1997. If successful, this may constitute an alternative model as powerful as that of formally chartered financial institutions.

12.8 Establishment of equity and quasi-equity funds to support the creation of future banks and financial companies that specialize in reaching the poor. Examples are Pro Fund, a $20 million equity fund in Latin America that began operations in 1995 with support from various sources, and ACCION's Gateway Fund, a projected $10 million equity, quasi-equity and lead debt investment fund.

12.9 To build on these promising beginnings, microfinance leaders and financial sector specialists must create the necessary facilitating frameworks and eliminate all obstacles to linking microfinance to capital markets. Working together, they must identify and resolve key issues. They must explore issues of regulatory environment, market imperfections, financial reporting, financial best practices, marketing, risk management, and credit rating.

12.10 In many ways microfinance represents the triumph of pragmatic reality over ideology. It is a strategy for reaching the lowest income sectors, but instead of charity or a safety net, it is an investment in people's self-reliance. It sets government's role at the beginning of the innovation cycle, where it can assist civil society to spearhead initiatives long before they are commercially viable, not to replace the role of the private sector but precisely to speed its very involvement.

13.1 The goal of reaching 100 million of the poorest families with microcredit is achievable if the flow of necessary funds can be insured, and if the world-wide institutional capacity can be built to do the job. Of these two conditions, the challenge of building capacity is the greater.

13.2 Capacity building must take place in a variety of ways and in many kinds of institutions. Existing exclusive microcredit programs like NGOs and poverty banks must be strengthened and expanded, and new ones must be created. NGOs are known for their ability to respond quickly to new challenges. International and regional NGOs can create local counterparts to undertake the task of dispensing microfinance, while they themselves can become the source of funds, training, technical assistance and quality control services. NGOs that are not already active may be drawn into the new world of microfinance. The many organizations that have some experience of microcredit will be supported in scaling up.

13.3 Other kinds of institutions also need to be encouraged and assisted in delivering microcredit to the poorest, including cooperatives, savings and loan associations, informal/traditional credit societies, credit unions, and banks of all kinds (commercial, agricultural, rural, development, and specialized). Local and national banks need to be motivated to initiate special microfinance departments and sub-institutions devoted to this specialized type of activity. Increasingly, as the success of microcredit becomes more obvious, banks will seek entry to the field. International and regional financial institutions must be prepared to provide guidance and to point local banks to sources of quality advice and training.

13.4 As a starting point to estimate the implications of reaching 100 million of the world's poorest people with credit for self-employment, a model has been developed to understand the scale and scope of institutional capacity required. The practical experience of FINCA and Grameen has been used in the development of the following projections.

14.1 The key factor in creating a new program is to find a committed individual who wants to accept the challenge and become a social entrepreneur. These are individuals who are interested in creating private sector solutions to social problems and who are committed to building a private sector institution based both on sound business practices and incorporating values linking it to its social purpose. Future social entrepreneurs are everywhere, but they themselves are unaware of their potential. They are found in all segments of society: business, academics, arts and culture, bureaucracy, professional groups, international organizations, religious institutions, political activists, social workers and many other backgrounds. The social entrepreneur may be already inspired and waiting for an opportunity to begin. Or, the situation can be exactly the opposite. The future leader may not even be aware of the existence of such programs or may even be hostile to the idea.

14.2 Future microfinance social entrepreneurs most often will discover the idea from a chance exposure through reading an article, watching TV, or listening to a conference speaker. The movement needs a systematic plan for publicity and recruitment through exposure and dialogue programs in order to find and develop the necessary talent as efficiently as possible. In addition, a training process needs to be established that will give each candidate an opportunity, within an enabling environment, to try out his or her talent.

14.3 Commercial and development banks, along with other financial institutions such as savings and loan associations, cooperatives, and credit unions can create and expand microfinance programs of their own. Instead of social entrepreneurs, they will identify specially trained CEOs for these programs. Recruitment and training of these private sector executives and their staff is as important as the development of social entrepreneurs in the NGO sector.

15.1 The experience of successful microcredit institutions suggests that an average of 10,000 borrowers can be served by each social entrepreneur/CEO. Therefore, in order to reach the goal of serving 100 million of the poorest families, something on the order of 10,000 social entrepreneur/CEOs will be needed (see endnote #6).

15.2 The social entrepreneurs/CEOs will need trained managers and field staff to work at the village level. At Grameen Bank one staff is required to serve 400 borrowers; in the FINCA system, a staff person is responsible for 300 borrowers. Taking into consideration demographic, political and social variations in countries around the world, we may conservatively assume that one staff member will serve 200 borrowers. Assuming this staff-client ratio, 500,000 fieldworkers will be needed. If one assumes a drop-out rate during training of 15 percent (Grameen's drop-out rate is 37 percent), the total number of intakes of trainee fieldworkers should be 575,000.

15.3 Based again on experience, it is possible to assume that one manager or supervisor will oversee the activities of 8 fieldworkers, and this in turn means that training must be provided to 71,875 managers/supervisors.

15.4 Over ten years this number can be trained in classes of steadily increasing size:

              Year                     No. of trainees
                             Field Workers         Managers     
              1996                2,000              250            
              1997                5,000              625
              1998               10,000            1,250
              1999               25,000            3,125
              2000               48,000            6,000
              2001               75,000            9,375
              2002              100,000           12,500
              2003              150,000           18,750
              2004              160,000           20,000
                              ----------        ---------     
              Total:            575,000           71,875

16.1 The training process for social entrepreneurs/CEOs will include the following stages:

Stage 1: Preparation for launching a start-up project;

Stage 2: Preparation for running a start-up program successfully;

Stage 3: Graduating to run a scaled-up project and create a viable branch/unit.

16.2 Four types of basic training will be needed:

1. Induction training
2. Refresher training
3. Advanced training
4. Specialized training

16.3 In addition to the basic curriculum, training facilities will periodically need to organize conferences on special issues. Training for the social entrepreneurs and business executives will be conducted on a different track from that provided for managers and line staff.

16.4 The following facilities may be created and supported for training of staff and management:

1. Training facilities within operating institutions
2. National level training facilities
3. Regional training facilities
4. Global training facilities.

17.1 Materials in several languages are needed to support the training programs. The international and regional specialized training centers will need support for the creation and distribution of materials (videos, audio cassettes, films, software, manuals, publications, etc), and will train the trainers from localities in the use of such materials.

18.1 It is safe to assume that 90 percent of managers and field workers will be trained in their own country by grassroots microcredit institutions, and 10 percent will receive training outside of their country at regional facilities.

18.2 In-country Training Cost Assuming a cost per fieldworker for six months of in-country training at $1,000; and a cost per supervisor/manager for six months of in-country training at $1,300:

         1.   Cost of training for 517,500       $ 0.517 billion
              fieldworkers
         2.   Cost of training for 64,688        $ 0.084 billion
              supervisor/managers                ---------------
                                  Sub-Total:     $ 0.601 billion

          1.   Cost of training for 57,500        $ 0.086 billion
               fieldworkers
          2.   Cost of training for 7,187         $ 0.014 billion
               supervisor/managers                ---------------
                                  Sub-total:     $ 0.100 billion

                   Total cost of in-country and
                   regional training:            $ 0.701 billion

** A section on building capacity in industrialized countries will be circulated to individuals and institutions in industrialized countries by May 20, 1996.

19.1 The Microcredit Summit Councils, with the support of the Microcredit Summit Secretariat, will be responsible for developing strategies for fulfillment of the Summit goal including, funding, monitoring progress, and expanding participation from their respective institutions and constituencies. Members of the first five councils listed below (19.2 through 19.6) have agreed to arrive at the Summit having prepared their institution's action plan for helping fulfill the Microcredit Summit's goal. Other council members (19.7 through 19.17) have agreed to announce their institution's action plan for contributing to the Summit's goal by February 1998.

19.2 Practitioners

19.2.1 Develop internationally agreed upon definitions, standards, and best practices. Working with representatives of commercial financial institutions, practitioners will need to define a common accounting language and format that can facilitate financial analysis of individual institutions and the industry. Practitioners will need to develop industry standards and a process for maintaining those standards.

19.2.2 Collaboration to develop training curricula and programs. Practitioners must be the driving force behind efforts to train staff for new institutions, and build capacity within existing institutions. Funds for training can be included as part of start up grants that must be available from public and private funders.

19.2.3 Development of a plan for growth. Practitioners will map out a plan for their institution's expansion that will contribute to the goal of credit for self-employment for 100 million of the world's poorest families, especially the women, by 2005.

19.3 Bilateral Donor Agencies. 19.3.1 International aid programs of industrialized country governments will need to provide a significant proportion of the grants required for the early years of the life of microcredit institutions in developing countries (including funding the microcredit institutions themselves, the training centers and the operating costs of the various microcredit networks). Red tape associated with application for and monitoring of grants must be diminished, and start up funds will need to flow through intermediary institutions that reach the poorest. This should be a coordinated strategy that operates with significant input from practitioners. Of the $6 billion needed in grant money, bilateral aid agencies could provide 66% of these funds, or $4 billion over the next nine years (an average of $440 million per year).

19.4 The United Nations Family of Grant-making Organizations

19.4.1 Many parts of the United Nations system are concerned in one way or another with the problem of global poverty and its resolution through targeted development. While each agency has its own area of specialization, such as health, child survival and development, women s welfare, food and nutrition, refugees, etc., they are all aware that grinding poverty is inextricably linked with virtually all the other issues of human welfare, as both cause and effect.

19.4.2 The United Nations should, as a family of organizations, declare the goal of reaching 100 million of the poorest families, especially the women, with credit for self-employment, as an overriding priority for the next decade. Each agency should be asked to develop a plan for how it will promote and support microcredit institutions serving the poorest. This mandate could be expressed through a variety of strategies, including reducing red tape and making grants to microcredit institutions for early operating expenses, loan funds and support for network offices. UN Agencies could also invest in promising microcredit start-up programs through the "Micro Start" program being developed by UNDP.

19.4.3 The collective commitment of the United Nations should be expressed in goals for each agency (e.g. UNICEF, UNIFEM, UNESCO, UNDP, WHO, UNFPA) that can be devised by teams in each agency and submitted for approval to the collective leadership of the UN.

19.4.4 UN agencies should commit $.5 billion of the $6 billion in grants that will be needed over the next nine years (an average of $55 million per year).

19.5 International Financial Institutions (IFIs)

19.5.1 Sources for low-interest, long term loans Institutions such as the World Bank, regional development banks, and the International Fund for Agricultural Development (IFAD) have a pivotal role to play in providing resources for microenterprise institutions through their programs that offer concessional loans (e.g. loans which are low-interest and long term) and loan guarantees. It is estimated that $3 billion in concessional loans from IFIs will be required over the next nine years (an average of 330 million per year).

19.5.2 Consultative Group to Assist the Poorest (CGAP) Created in 1995 by the World Bank, CGAP has a significant role to play in mobilizing grant monies and concessional loans for intermediary institutions that have proven track records in reaching the poorest.

19.6 Banks and Commercial Finance Institutions

19.6.1 Collaboration with practitioners to determine the set of characteristics microcredit institutions should have in order to be considered "bankable" An international committee of financial experts, bankers, accountants and practitioners should define those characteristics such as asset size, equity to debt ratios, and length of track record that will make microcredit institutions bankable. This committee should define general benchmarks for the growth of microcredit institutions that need to be reached for increasing levels of credit to be available.

19.6.2 Development and identification of best financial management practices Banks and commercial finance institutions should collaborate with practitioners to identify microcredit industry best practices including: financial reporting, risk management, accounting, and marketing microcredit programs to financial markets. They should assist microfinance institutions in becoming more viable clients by transferring to them relevant commercial banking technologies, including personnel training programs, information and accounting systems, and other banking management technologies.

19.6.3 Extending credit to microcredit institutions at commercial rates Creating credit lines from banks and other traditional financial institutions to specialized intermediaries with successful track records in lending to very poor people both in order to enable the specialized institutions to expand their microlending operations and for on-lending to microenterprises.

19.6.4 Developing appropriate instruments to tap both commercial and socially conscious investment in microfinance

19.6.5 Collaborating in liquidity management of microfinance institutions' cash flows

19.6.6 Advocate for industry regulation reform The support of commercial banks for the reforms needed by microcredit practitioners in order to allow their development into self-sustaining financial institutions will be critical.

19.6.7 Education of industry peers Those banking professionals and financial industry leaders who have already joined the microcredit movement have a critical role to play in educating the larger banking and commercial finance community about microcredit, and the opportunities for collaboration with, and investment in, this emerging industry.

19.7 Corporations

19.7.1 Corporations that are not banks themselves can still play an important role in the campaign. The Microcredit Summit seeks to create a strong and committed corporate council to coordinate activity within this sector and to link it closely to the broader movement. Corporations can provide grants for start-ups as part of the $1 billion commitment from the private sector. They can lend their expertise (e.g. accounting, marketing, public relations) to the microcredit movement and the institutions and the networks seeking to upgrade their infrastructure and customer services. Corporations should educate employees and customers (including through advertising budgets) about microcredit, and advocate its importance to government officials.

19.8 Non-Governmental Organizations and Credit Unions

19.8.1 NGOs and credit unions are the type of organization most likely to give birth to new microcredit institutions. Many NGOs and credit unions have launched microcredit programs over the past two decades. Many more need to be involved in the creation of microcredit institutions, and those that are already involved need to rapidly expand their existing networks and coverage.

19.8.2 NGOs should review their program plans and search for ways to incorporate microcredit into a steadily increasing proportion of their anti-poverty operations. However, NGOs moving to incorporate microcredit as part of their program portfolio must commit to building self-sustaining, business-oriented microcredit institutions.

19.8.3 NGOs and credit unions should link their microcredit projects with the global network of practitioners and advocates being built around the Microcredit Summit so that they may participate in plans for standardizing the industry, and may benefit from the information and technical assistance available in these networks.

19.8.4 This shift can be enhanced if the national associations of NGOs and credit unions (e.g. InterAction in the United States, ACFOA in Australia, FAVDO in Africa, and the World Council of Credit Unions) encourage microcredit institutional development among their member agencies. In collaboration with established microcredit networks (e.g. SEEP Network, CASHPOR), they should develop a regular schedule of training conferences designed to educate their member agencies as to the best strategies and techniques for creating new microcredit programs and institutions, as well as expanding existing ones.

19.8.5 Of the $6 billion needed in grant monies, NGOs should look for ways to raise and/or reprogram ___% or $__ million from non-governmental sources.

19.9 Service Clubs

19.9.1 Service clubs are a valuable means of connecting civic-minded business people on an international basis. FINCA and other organizations have already successfully linked service clubs in the United States with village banks in Latin America. Clubs throughout the world can provide start-up grants, direct technical assistance (e.g. accounting assistance from a club member) and moral support for microcredit institutions around the world. Service clubs should create a goal for the number of microcredit institutions they will help launch each year. Service clubs could provide $100 million, or __% of the total amount of private sector grant monies needed by the campaign.

19.10 Foundations and Philanthropists

19.10.1 Foundations and philanthropists have had a long history of leadership in the commitment to reduce human suffering. The field of microfinance as an anti-poverty tool is a dynamic and yet relatively new phenomenon. For this reason it remains relatively unknown and underfunded within the foundation field. Foundations should explore how supporting microfinance will contribute to the fulfillment of their basic mission, and look for ways to expand the proportion of microfinance within their grantmaking. Foundations and philanthropists should educate their peers to do the same.

19.11 Educational Institutions

19.11.1 From grade school through graduate schools, educational institutions provide the foundation for what we know and value as a global society. Educational institutions at all levels should look for ways to educate the students, their families, their faculties, and their staff about the potential of microcredit as an anti-poverty tool and the opportunity for people at all levels of society to contribute to the campaign of reaching 100 million of the world's poorest families with credit for self-employment by 2005.

19.12 Religious Institutions

19.12.1 At the core of all major religions is a deep commitment to serving the poor. The Microcredit Summit provides an opportunity for religious institutions to educate their congregations on new ways to assist people in eliminating their own poverty. Leadership from the spiritual community has been central in most social movements. This must be no less true of the microcredit movement.

19.13 Parliamentarians

19.13.1 Parliamentarians have a unique role to play in bringing about societal change. They have the opportunity to educate and inspire their colleagues, their constituents and the media. The political will to make change may start at the top or may start at the bottom, but to be truly lasting it must involve all sectors of society. Parliamentarians will have many allies in fulfilling the goals of the Summit, but their leadership in this effort helping to change laws and the regulatory environment, ensuring funding, highlighting success stories and educating their colleagues and constituents may be one of the most important commitments of their political career.

19.14 Domestic Government Agencies

19.14.1 Regulatory change Through international committees, model legislative provisions should be created to allow a more favorable environment for microcredit institutions. The model laws could open the way for mobilizing savings, removing interest rate ceilings, guaranteeing the repatriation of capital from other countries, allowing non- collateralized lending, and easing licensing of financial institutions. These provisions should both insure integrity of these programs and minimize the bureaucratic hurdles these programs face. A goal should be set for adoption of this legislation by sufficient countries to facilitate the spread of institutions to reach 100 million of the poorest households.

Governments and financial institution supervisory agencies should also enact legislation and promulgate regulations that will provide for a sound system of depositor protection and promote confidence in all financial institutions accepting deposits, including microcredit institutions. Such legislation and regulation should provide for minimum depositor protection in the form of rapid reimbursement of deposits in the event a depository institution is deemed insolvent, or provide assistance to those institutions that are in danger of insolvency.

Supervisory agencies should work with microcredit practitioners to further develop and establish common international standards regarding performance and operation of microfinance institutions, including a common rating for assessing the safety and soundness of such institutions. Supervisory agencies should recognize the standards established by the microcredit industry and insure that all present and future standards and regulations serve to "add value" to the microfinance industry. Governments and supervisory agencies should enact legislation and promulgate regulations that will encourage commercial financial institutions to develop partnerships with microcredit programs.

19.14.2 National and provincial microfinance funds in developing countries Governments should contribute to the creation of domestic funding programs and provide adequate funding for microcredit institutions. These programs should be capable of providing grant funds, concessional loans, and a supportive environment for the participation of commercial financial institutions. Central Banks could stimulate linkages between commercial banks and microcredit programs by providing a line of credit to commercial banks for on-lending to microcredit programs.

19.14.3 National and provincial microfinance funds in industrialized countries Ways must be found to make concessional loan funds available to microcredit programs in industrialized countries.

19.15 Heads of State and Government 19.15.1 As we move into the 21st century, one of the greatest factors contributing to national instability and civil unrest is the widening gap between rich and poor. Fulfilling the goals of the Summit is the greatest single intervention known for resolving this disparity. During the 1980s, there was an unprecedented expansion of childhood vaccination rates in the developing world. The jump from 25 percent vaccination rates in the early 1990s to 80 percent at the end of the decade has helped save the lives of tens of millions of children. Heads of state and government played an significant role in this success, launching vaccination campaigns and getting personally involved.

19.15.2 The direct involvement of governments in administering microfinance programs has usually led to the politicization of the program and disastrous results. Governments must be supportive without being overbearing. Heads of State and Government can educate their nations and other heads of state and government. They can listen to practitioners and borrowers and push for the policy changes needed.

19.16 Media

19.16.1 The media have a responsibility to report on the positive developments in human affairs as well as the catastrophes. While the steady growth and success of microcredit institutions may not be the stuff of headlines, it merits regular coverage in print and electronic media.

19.16.2 A committee of media professionals will be organized to develop a strategy for media coverage of the microcredit movement. This could include things such as site visits to projects for professionals, reports, awards for excellent coverage and specialized briefings and seminars.

19.17 Advocates

19.17.1 The primary role of the advocacy movement is to overcome the most basic constraints: the fear of failure, regulatory restraints, and the lack of awareness. This can be done through a dramatic presentation of the programs that have succeeded and the lives that have been transformed through program participation. The movement will need to develop a media penetration strategy to greatly increase public recognition of the importance of microcredit, to raise funds, and to create a favorable public policy climate. Institutions who are members of the Microcredit Summit Council of Advocates will be called upon to support the Summit goal through fundraising, education, advocacy, policy development and research.

20.1 The Microcredit Summit has established councils for each of the above sectors in order to commit to strategies, monitor progress, and advocate for change within their respective institutions and constituencies.

20.2 The Microcredit Summit will establish the Microcredit Summit 2005 Campaign Committee. The Campaign Committee will include the chairs of all councils: practitioners, donor agencies, UN Agencies, international financial institutions, banks and commercial finance institutions, corporations, NGOs, service clubs, foundations, educational institutions, religious institutions, parliamentarians, domestic government agencies, advocates, media, and heads of state and government.

20.3 RESULTS Educational Fund will function as secretariat for the Microcredit Summit 2005 Campaign Committee. The Microcredit Summit Secretariat carries the responsibility for overall organization and monitoring of the unified effort, and publishing an annual score card to measure progress made. The Secretariat will recognize those organizations and individuals who are making outstanding contributions and will point out areas where progress is falling behind schedule.

2.) While programs in developing countries will require subsidies inthe from of grants and donations in the early years of growth, they will be expected to charge interest rates to their clients sufficient to allow for self-sufficiency to be reached within seven to ten years. It remains undemonstrated whether or not microcredit programs in industrialized countries will be able to reach self-sufficiency.

3.) Launched in June 1995, CGAP currently has over a dozen members from among donor agencies and the regional development banks. CGAP's core objectives are to: (i) strengthen donor coordination in the field of microfinance; (ii)_ increase learning and dissemination of best practices for delivering financial services to the poor on a sustainable basis; (iii) mainstream microfinance within World Bank operations; (iv) create an enabling environment for microfinance institutions; (v) support microfinance institutions that deliver (or are capable of delivering) credit and/or savings to the very poor on a sustainable basis; and (vi) help established providers of microfinance to assist others start such services in under-served regions.

4.) Policy Advisory Group Members include: Muhammad Yunus, Grameen Bank (Chair); Kamardy Arief, Bank Dagan Nasional Indonesia; Nancy Barry, Women's World Banking; Ela Bhatt, Self-Employed Women's Association; Renee Chao-Beroff, Centre International de Developpment et de Recherche; Martin Connell, Calmeadow; Klaas Kuiper, International Agency for Economic Development; Kimanthi Mutua, Kenya Rural Enterprise Program; Maria Nowak, Caisse Francaise de Development; Maria Otero, ACCION International; Lawrence Yanovitch, Foundation for International Community Assistance (FINCA).

5.) CGAP's policy Advisory Group has defined the poorest as those people inthe bottem fifty percent of the people living below the poverty line established by each country.

6.) These indicators of scope reflect institutional averages. The staffing and organizational models underpinning these numbers need not be interpreted literally. This model is offered as a basis for determining the dimension of staffing anf organizational needs required in order to achieve the Summit's goal.

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