Microfinance School > Best Practise: Diaconia FRIF

  • Produksjonsår: 2011

42,587 visninger

Serie: Microfinance School

  1. Banking the Unbanked


    Microfinance institutions are now present in almost every country in the world, and are providing access to financial services to millions of people. In this film we look at typical microfinance tech-nologies and methodologies in three very different countries, but with similar needs. Access to fi-nancial services such as savings, loans and insurance is an important tool to help poor people smooth out the negative effects of little and fluctuating income.

  2. Human Capital


    Access to money alone is often not enough to lift people out of poverty. In order to facilitate a social change you need be healthy and you need knowledge. In Human Capital we look at a holistic ap-proach to microfinance. Many microfinance institutions combine financial services with education and health programs with the aim of long-term social change. What are the benefits and what are the disadvantages of such an approach? How do you measure social change?

  3. Banking woman


    Microfinance institutions traditionally have targeted women. They have proven to be more reliable debtors and the loans tend to bring more benefit to the whole family. A dollar to a woman is a dol-lar to the whole family, so to speak. In this film we focus on microfinance projects and/or institu-tions targeting women especially. How are these projects different from microfinance that targets both genders? How can access to financial services be an effective tool towards a gender equal soci-ety, both economically and socially?

  4. Best Practise: Miles for smiles


    Katherine Kitongo identified a problem in Ugandan markets. The different stalls where often run by single mothers forced to bring their children to work with them. It is a double whammy; the children did not go to school and the mothers could not run their business as effective as they wanted to. Katherine's answer was Miles to Smiles, a daycare center for the children of the women in the mar-ket. And the fees for the daycare center? Katherine set up a loan and savings group for the mothers at the center.

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Microfinance practices span from individual bank like services to petty, short time loans taken up in groups. It can finance production enterprises with several employees as well as being the little cash you need to buy a bag of rice at the big market to sell in small with a tiny profit in your neighbor-hood. Some of the loan takers have a good understanding of investment, interest and risk; others have no thought for the day after tomorrow. In this reality, microfinance in all varieties is a tool with a great potential. It is not the only one, and it does not always work. In this section “Best practise” we will publish only the good stories, those that can inspire to continue the work to reduce poverty through microfinance.

Like many microfinance institutions, Diaconia FRIF does not ask for any collateral for their loans. They believe in a moral guarantee, a relationship based on trust. In order to establish this, Diaco-nias credit officers research the potential clients. Are they who they say they are, and can they be trusted? The methodology seems to work; less than 0,5 % of Diaconias clients default on their loans.