Microfinance’s reputation has suffered a great deal from the stories of greed and poorly regulated operations in Andhra Pradesh. However, the concept and theory behind microfinance have noble roots; empowering the poor and fighting against poverty. Both of which are worth caring for.

We, at Green Shoots Foundation, view microfinance as one of the three fundamental channels for sustainable development within the developing world. The other two are education and the prevention / relief of disease / illness.

If properly managed, the introduction of microfinance into an area can produce a ripple effect that assists in the other two being more attainable and vice-versa. Consider the following chain of events:

Allowing people to access financial services enables them to utilise their labouring capabilities and, hopefully, to achieve financial independence. This means that they could be in a position to support their families and improve their social standing. Gender sensitivity is at the forefront in microfinance, enabling women to become more independent, manage their households and be in a position to increase their household incomes and accumulate savings. With more money, children are able to attend school and gain a basic education, as they are no longer required to work and contribute towards the household income. Lastly, in some scenarios, social and health services can become more accessible as people are able to travel longer distances. At times, collective empowerment within a community can also instigate new initiatives and work towards improving the infrastructure.

A burgeoning scenario in the microfinance sector and another reason to care about microfinance is the integration of environmental sustainability and microfinance i.e., green microfinance. This involves the introduction of environmentally friendly products via Microfinance institution or their preference of supporting environmentally friendly activities.

These examples demonstrate the malleable nature of microfinance and its ability to leverage sustainable development in a variety of scenarios. Ultimately, the goal with microfinance is to help the poor reach economic empowerment that they can sustain and be able to provide for their families. This is what we stand for.