Microfinance Debated: Mission to Serve the Ultra Poor?

It is estimated that there is a $300 billion gap globally between what current financial institutions offer and what low-income people need. This is the space that microfinance institutions (MFIs) around the world seek to fill.

At the 2009 microfinance conference-sponsored by the Harris School of Public Policy Studies and the Booth School of Business-heated debate centered on how to fill that $300 billion gap when clients are poor, and many institutions are nonprofit. In fact, speakers debated more about which model of microfinance is most effective than how the field could unite to best serve those who fall within the "capital gap."

Ultimately the question of whom MFIs serve takes secondary importance to a bigger question: are developmental finance institutions successful in alleviating poverty?

Read on here.