Promoting Inclusive Markets and Financial Systems
The MasterCard Foundation works with visionary organizations to provide greater access to education, skills training and financial services for people living in poverty, primarily in Africa. As one of the largest private foundations its work is guided by its mission to advance learning and promote financial inclusion to create an inclusive and equitable world. Based in Toronto, Canada, its independence was established by Mastercard when the Foundation was created in 2006. For more information and to sign up for the Foundation’s newsletter, please visit www.mastercardfdn.org. Follow the Foundation at @MastercardFdn on Twitter.
Community-Managed Loan Funds--Which Ones Work?
- Externally funded groups. When loans are financed by an early injection of external funds from donors or governments, CMLF projects appear to fail so consistently that this model of microfinance support is never a prudent gamble.
- Savings-based groups. CMLFs are often successful when loans are financed by members’ own savings, and there is either no external funding, or such funding arrives in modest amounts after the group has a solid track record of lending and recovering its own savings.
- Self-help groups (SHGs). When groups start by collecting and then lending members’ own savings, but subsequently receive large loans from a bank that is serious about collection, performance has been mixed so far.