UNITED NATIONS CAPITAL DEVELOPMENT FUND    Microfinance

Issue 14 / July 2005

Issue Table of Contents

Update

on the International Year of Microcredit 2005

Marketplace

Made by Microentrepreneurs

Upcoming Events

Conferences, events and trainings.

Links

New websites and publications.

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The French government and its development agency, l'Agence Française de Développement (AFD), organized a conference, "Expanding Access to Microfinance: Challenges and Actors," on June 20, 2005, in partnership with the United Nations, and British and German authorities. The President of France, Jacques Chirac, welcomed the participants, which included high-level government officials, donors and private stakeholders from all over the world. Government officials in attendance included the Prime Minister of Morocco, the Minister of Economy and Finance of Haiti, the Minister of Finance of Congo, the Minister of Rural Development in Afghanistan, the Former Minister of Finance of Bolivia, the State Secretary for Development of the United Kingdom and the Minister of Foreign Affairs of France. Other attendees included representatives from microfinance institutions and banks from countries from around the world including the United States, Switzerland, Cambodia, Bolivia, Mozambique and Tajikistan. Organizations represented included the World Bank, USAID, ACCION International, the African Microfinance Network, MicroSave, PADME, and Planet Finance

Conference speakers included Nemat T. Shafik, General Director of Regional Programmes at the United Kingdom Department for International Development (DFID), Jean-Michel Severino, General Director of AFD and Elizabeth Littlefield, Chief Executive Officer of the Consultative Group to Assist the Poor (CGAP).

The main message of the meeting was that microfinance is a powerful tool to help poor people. Given the unsatisfied demand for a wide range of financial services, the challenge now is to integrate microfinance into the formal financial services sector. Further, governments can play a critical role by ensuring macroeconomic security, developing sound policy frameworks and encouraging competitive and diversified microfinance. Conversely, by engaging in the sector directly, the government can impede and even destroy the microfinance sector.

During the conference, sessions were held to discuss the role of governments and central banks, public-private partnerships, assessing microfinance demand and the role of donors. The session on understanding demand for microfinance highlighted the need to additional research to meet the needs of poor households. Historically, the focus has been on meeting the credit needs of microenterprises. Now the challenge is to move toward client-responsive services. While, broadening the outreach of microfinance services, panelists emphasized the importance of complementary investments in other sectors such as health and education.

In later sessions, panelists discussed the need to capitalize on partnerships between the civil, private and public sectors. Finally, the point was made that public subsidies are needed to build local capacity but aid must become more effective and should support diversification of services. Organizers cited the ultimate goal as the creation of strong national, financial intermediaries. The one-day conference was followed by a day of workshops and a symposium in Frankfurt, dedicated to the creation of new partnerships with the financial sector as well as the private sector in general.