Paper
Microcredit and the Poorest of the Poor: Theory and Evidence from Bolivia
What determines the depth of outreach?
14 pages
The authors construct a theoretical framework that describes the social worth of a microfinance organisation in terms of depth, worth to users, cost to users, breadth, length andscope of its output. The paper addresses three questions:
- Do microfinance organisations reach the poorest of the poor?
- Do group loans reach the poorest better than individual loans?
- Do rural lenders reach the poorest better than urban lenders?
It then analyses the evidence of depth of outreach for five microfinance organisations in Bolivia and concludes that:
- Most of the poor households reached by the microfinance organisations were the richest of the poor, those near the poverty line;
- Group lenders had more depth of outreach than individual lenders;
- The urban poorest were more likely to be borrowers and;
- Rural borrowers were more likely to be among the poorest.
About this Publication
Published