Microfinance on the Cutting Edge

This paper presents a summary of the Microfinance Network Conference, "Microfinance on the Cutting Edge", convened in Tanzania in 2004, and hosted by Promotion of Rural Initiative and Development Enterprises Limited (PRIDE) Tanzania. The conference aimed to:

• Understand the uniqueness of practitioner to practitioner exchanges;
• Analyze current obstacles to growth;
• Reaffirm a common goal to making microfinance sustainable and permanent.

The conference discussed:

• Global perspectives on progress and challenges observed in microfinance;
• Visits made by the conference participants to different branches of PRIDE, Tanzania;
• Tapping into local markets to meet the need for capital;
• Working with international investors;
• Pro-consumer policies;
• Innovations in rural finance;
• Use of information technology in MFIs;
• Staff incentive schemes.

Some of the key points that emerged from the conference were:

• Despite challenges, microfinance in Tanzania has moved towards long-term growth and sustainability, helped by a sound regulatory and supervisory framework;
• Credit information, technology and quality information on performance are going to enable future global growth;
• Tapping into domestic capital markets is risky, but cheaper, for MFIs;
• Pro-consumer agenda ensures that clients are treated in a fair manner;
• Technology is helping to increase outreach in urban as well as rural areas;
• Staff incentives increase inefficiency and help the MFI reach its goals of profit and outreach.