Financing Businesses in Africa : The Role of Microfinance

This paper evaluates how microfinance performed in providing business financing in 27 Sub-Saharan African countries. It uses data from the 2009 and 2010 Gallup World Poll, a nationally-representative survey of at least 1,000 individuals per country, conducted in up to 157 countries per year. The data, supported by rigorous statistical evidence in related literature on the use of microcredit around the world, demonstrate that economic gains from microcredit have been more modest than what was once believed. On the other hand, the analysis suggests that the poor save in order to start new businesses and that the introduction of formal products for small savings can be a key financial innovation. The authors also analyze the challenges the poor face in setting money aside to save, and discuss what policymakers can do to promote savings.

Bibliographic Details

Main Authors:	Aggarwal, Shilpa, Klapper, Leora, Singer, Dorothe
Format:	Policy Research Working Paper biblioteca
Language:	English
Published:	2012-02-01
Subjects:	ABSENCE OF CREDIT, ACCESS TO BANKING, ACCESS TO BANKING SERVICES, ACCESS TO CREDIT, ACCESS TO FINANCIAL SERVICES, BANK ACCOUNTS, BANK FINANCING, BANK POLICY, BANKING SECTOR, BANKING SERVICES, BORROWER, BORROWING, BUSINESS INVESTMENT, BUSINESS OWNERS, BUSINESS-OWNERS, CENTRAL BANK, CENTRAL BANKS, CHECKS, COLLATERAL, COMMERCIAL BANKS, CONSUMPTION EXPENDITURES, CORRUPTION, CREDIT ACCESS, CREDIT ALLOCATION, CREDIT ASSOCIATIONS, CREDIT CONSTRAINTS, CREDIT COOPERATIVES, CREDIT HISTORY, CREDIT MARKETS, CREDIT PRODUCTS, CREDIT PROGRAM, CREDIT PROGRAMS, CREDIT SCORING, CREDITS, CREDITWORTHINESS, DEBT, DEMOGRAPHIC, DEPOSIT, DEPOSIT ACCOUNTS, DEPOSIT INSURANCE, DEPOSITOR, DEPOSITORS, DEVELOPING COUNTRIES, DEVELOPMENT BANK, DURABLE, EARNINGS, ECONOMIC DEVELOPMENT, ECONOMIC GROWTH, ECONOMICS, ENTREPRENEUR, ENTREPRENEURIAL FINANCE, ENTREPRENEURS, ENTREPRENEURSHIP, EXPENDITURES, FARMERS, FEES ON DEPOSITS, FEMALE ENTREPRENEURS, FINANCIAL ACCESS, FINANCIAL ASSISTANCE, FINANCIAL CRISES, FINANCIAL DEVELOPMENT, FINANCIAL HEALTH, FINANCIAL INNOVATION, FINANCIAL INNOVATIONS, FINANCIAL LITERACY, FINANCIAL MARKET, FINANCIAL SECTOR, FINANCIAL SELF-SUFFICIENCY, FINANCIAL STUDIES, FINANCIAL TRANSACTIONS, FIXED COST, FORMAL BANK, FORMAL BANKING, FORMAL CREDIT, FORMAL FINANCIAL INSTITUTIONS, FORMAL FINANCIAL SERVICES, FORMAL LENDING, GENDER, GROUP LENDING, GROUPS OF PEOPLE, HOUSEHOLDS, INCOME, INCOMES, INDEBTEDNESS, INFORMAL ECONOMY, INFORMAL INSURANCE, INFORMAL SAVINGS, INSTITUTIONAL CREDIT, INTEREST RATE, INTERNATIONAL BANK, INTERNATIONAL LABOUR ORGANIZATION, INVESTMENT CLIMATE, INVESTMENT SPENDING, JOINT LIABILITY, JOINT-LIABILITY, JUDICIAL ENFORCEMENT, LACK OF ACCESS, LEGAL CONSTRAINTS, LENDER, LENDING DECISIONS, LENDING INSTITUTIONS, LIMITED ACCESS, LIMITED ACCESS TO FINANCE, LOAN, LOAN APPLICANTS, LOAN ELIGIBILITY, LOAN PRODUCT, LOCAL INSTITUTIONS, LOCKBOXES, MFI, MFIS, MICRO ENTERPRISES, MICRO FINANCE, MICRO-CREDIT, MICRO-INSURANCE, MICROCREDIT, MICROENTERPRISES, MICROFINANCE, MICROFINANCE INSTITUTIONS, MICROFINANCE PRACTITIONERS, MICROINSURANCE, MONETARY FUND, MONEY LENDERS, MONEYLENDERS, NEW BUSINESS, NEW BUSINESSES, POLITICAL ECONOMY, PORTFOLIOS, POST OFFICES, PRIVATE SECTOR DEVELOPMENT, PRODUCTIVE INVESTMENTS, PRODUCTIVITY, PROFITABILITY, REGULATORY ENVIRONMENT, RESERVE, RESERVE BANK, RESERVE BANK OF INDIA, RETURN, RETURNS, RISK MITIGATION, RURAL BANK, RURAL BANKS, SAVINGS, SAVINGS ACCOUNTS, SAVINGS GROUPS, SAVINGS INSTITUTIONS, SAVINGS PRODUCT, SELF-EMPLOYMENT, SMALL BUSINESS, SMALL BUSINESS LOANS, SMALL ENTREPRENEURS, SMALL LOANS, SOCIAL BANKING, SOCIAL CAPITAL, SOLVENCY, SOURCE OF FUNDS, START-UP, TAX, TRANSPARENCY, UNION, VILLAGE, VILLAGE FUND, VILLAGES, WEALTH CREATION, WITHDRAWAL, WITHDRAWAL FEE, WITHDRAWAL FEES,
Online Access:	http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20120222133705 http://hdl.handle.net/10986/3261
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