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Commercialization: Overcoming the Obstacles to Accessing theCommercial Funds While Maintaining a Commitment to Reaching the Poorest
Community of Practice: Financial Services
Can money with a commercial price tag be used to reach the world’s poorest microfinance clients? This chapter looks at the current supply of commercial capital available for microfinance and compares it with the demand expressed for that capital and the capacity of microfinance institutions to deploy it effectively. It looks closely at the different actors involved in bringing market capital to the grassroots level, so that multimilliondollar investments can be distributed in $50 and $100 loans. Through interviews with leaders on the supply and demand sides, as well as with those that help build connections between the two, this chapter examines how commercial funds are deployed to serve very poor clients, and the obstacles that prevent this deployment from happening more often. It concludes with recommendations on steps that various actors in the world financial community can take to ensure that funding from domestic and international capital markets is made available to those for whom it will have the most impact.