Breaking Down the Walls between microfinance and the Formal Financial System

June, 2004     Elizabeth Littlefield and Richard Rosenberg

Microfinance works. It enables the poor to build assets, diversify and increase incomes, and reduce their vulnerability to economic stress. Microfinance is sustainable: Dozens of institutions have proved that financial services for poor people can cover their full costs, through adequate interest spreads, relentless focus on efficiency, and aggressive enforcement of repayment.