Paper

Microfinance Role in Post Conflict and Crisis Situations

Microcredit and group formation in conflict-affected areas for financial and social empowerment
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This paper discusses the role that microfinance can play in post-conflict and crisis situations.

It begins by explaining the following aspects of microfinance:

  • Role as a poverty alleviation tool;
  • Advantages over formal financial institutions (FFIs);
  • Target population;
  • Goals, principles, products and services;
  • Microcredit as a core product.

The paper then discusses:

  • Main characteristics of post-crisis areas;
  • Ability of microfinance to bring about effective solutions because of its flexibility and adaptation to peoples needs;
  • Microcredits potential as a development tool;
  • The role of group meeting and social mobilization in providing:
    • Technical support;
    • Support in moral and social reconstruction;
    • Informal training and therapy.

The paper identifies the following concrete benefits of microfinance in post-conflict situations:

  • Change of social pattern;
  • Empowerment;
  • Sectoral development.

The paper recommends multilateral partnerships between the donor community and operating MFIs to make an effective contribution in the post-conflict scenario. It concludes by presenting two case studies of MFIs that have provided effective solutions to conflict-affected populations through microfinance.

About this Publication

By Ahmmed, M.
Published