Comments on: A place for profits in microfinance? http://blog.acumenfund.org/2006/10/30/a-place-for-profits-in-microfinance/ Thu, 18 Mar 2010 19:52:35 +0000 http://wordpress.org/?v=2.6 By: Sush http://blog.acumenfund.org/2006/10/30/a-place-for-profits-in-microfinance/#comment-39206 Sush Wed, 07 Mar 2007 15:42:35 +0000 http://blog.acumenfund.org/2006/10/30/a-place-for-profits-in-microfinance/#comment-39206 Jacqueline: I have been thinking about the same issue for quite some time now. I believe that successful (profitable) microfinance institutions should not have to fight harder for donor funds. Some of these institutions have spent several years in building organization capacity and strengthening their programs through experimentation. Only now have they reached a point where they have started seeing some green ink. To deny them funds because they are becoming profitable is to penalize better management and operational efficiency. I agree that there is need to change the mindset of donors and communicate the power of market-oriented approaches to them. The fact that some of the wealthiest people are engaged in this conversation should indeed lead the way for the rest of donors to see the power of market-oriented approaches to lift people from poverty. Jacqueline: I have been thinking about the same issue for quite some time now. I believe that successful (profitable) microfinance institutions should not have to fight harder for donor funds. Some of these institutions have spent several years in building organization capacity and strengthening their programs through experimentation. Only now have they reached a point where they have started seeing some green ink. To deny them funds because they are becoming profitable is to penalize better management and operational efficiency. I agree that there is need to change the mindset of donors and communicate the power of market-oriented approaches to them. The fact that some of the wealthiest people are engaged in this conversation should indeed lead the way for the rest of donors to see the power of market-oriented approaches to lift people from poverty.

]]> By: Munya http://blog.acumenfund.org/2006/10/30/a-place-for-profits-in-microfinance/#comment-13203 Munya Fri, 03 Nov 2006 13:06:03 +0000 http://blog.acumenfund.org/2006/10/30/a-place-for-profits-in-microfinance/#comment-13203 For me the following quote speaks volumes "Corporate responsibility isn't philanthropy, it's business. For us, social responsibility is about creating social benefits through our brands and through our interactions as a business with society. It's the business of doing business responsibly." That justification can also be used to tackle the question of profit or not for profit in microfinance. The operators need intergrate CSR as part of doing business sustainably. The private sector enterprise has proven to very replicable and sustainable as long as demand for their service exists. When we talk about targeting those who earn less than $4 a day, that include many urban dwellers in Africa who I think would be best served by private entities, non profits could take a leadership role in the less explored rural markets of the continent but even better in capacity of potential business people, The recommendations in the document below are a good example, and I hope the Acumen fund can consider making investments in ICT firms as well. http://www.infodev.org/en/Publication.177.html For me the following quote speaks volumes

“Corporate responsibility isn’t philanthropy, it’s business. For us, social responsibility is about creating social benefits through our brands and through our interactions as a business with society. It’s the business of doing business responsibly.”

That justification can also be used to tackle the question of profit or not for profit in microfinance. The operators need intergrate CSR as part of doing business sustainably. The private sector enterprise has proven to very replicable and sustainable as long as demand for their service exists. When we talk about targeting those who earn less than $4 a day, that include many urban dwellers in Africa who I think would be best served by private entities, non profits could take a leadership role in the less explored rural markets of the continent but even better in capacity of potential business people,

The recommendations in the document below are a good example, and I hope the Acumen fund can consider making investments in ICT firms as well.

http://www.infodev.org/en/Publication.177.html

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