Introduction to Microfinance

Flat World Knowledge is thrilled to publish the first introductory college textbook about microfinance. This book introduces students to the array of financial and non-financial services available for the world's poor, explores the financial lives of the people who receive those services, and traces the evolution of the microfinance industry from its philanthropic origins to its commercial--and sometimes controversial--status today.

The idea that the poor can lift themselves out of poverty is at the heart of microfinance. It began in the 1970s with the following question:"If small business owners could borrow funds at commercial interest rates, could they lift themselves out of poverty?" The microfinance industry was born and has since grown into a global industry that reaches 150-200 million clients. It has matured from exclusively funding loans to providing savings, insurance, healthcare, and education. But this success comes at a price; controversies surround the industry and empirical research challenges some of its results.

Introduction to Microfinance explores this dynamic subject by first defining microfinance, and then studying the lives of those it serves and the economic systems that work against those people. From there, it analyzes the different parts of the microfinance industry and how it breaks down those barriers to economic success. Then, the final chapters of the book explore the state of the industry today, its goals for the future, and how students can get involved.

Each chapter ends with a series of discussion questions, and there are a variety of case examples that appear in supplementary boxes to stimulate further discussion:

Dig Deeper: These boxes highlight a concept within the main text and analyze it further, citing direct examples from the industry or evidence from empirical research.

In the Field: These boxes highlight the experiences and practices of specific microfinance institutions or related organizations.

Faces: These boxes illustrate the personal stories of the poor, both before and after microfinance.

In Your Backyard: These boxes introduce microfinance as practiced in the U.S. and other developed nations from the perspectives of microfinance institutions, funders, and the public.

Introduction to Microfinance can be used in stand-alone courses in microfinance or within broader courses in international economic development, political economy, or social entrepreneurship.

All royalties from the book are donated to support microfinance clients and their families worldwide.

• Chapter 1: An Introduction to Microfinance
• Chapter 2: The Lives and Financial Needs of the Poor
• Chapter 3: The Economics of Financial Systems
• Chapter 4: Informal Finance
• Chapter 5: Microlending
• Chapter 6: From Microlending to Full Service Microfinance
• Chapter 7: Gender Issues in Microfinance
• Chapter 8: The Commercialization of Microfinance
• Chapter 9: Measuring Performance and Impact of Microfinance
• Chapter 10: Alternative Goals of Microfinance
• Chapter 11: The Future of Microfinance and How to Get Involved