Microfinance in Yemen “Challenges and Opportunities”

This paper aims to identify the challenges and opportunities facing microfinance in Yemen. It is based on secondary data collected from records of the Social Fund for Development, Yemen Microfinance Network, the Government of Yemen, microfinance books, websites, and other relevant sources. The study covers the period from 1997 to 2013 and finds that there are multiple factors hindering the development of microfinance in Yemen. It suggests that despite challenges, there is potential for a promising microfinance market in the country with more than two million potential clients who are unserved. The paper covers the following sections in detail:

• Discussion on the Yemen economy;
• Methodology used with a focus on the problem, purpose, and importance of the study and data collection methods;
• Discussion on the definition and evolution of microfinance;
• Review of relevant literature;
• History of microfinance in Yemen and the Social Fund for Development Services;
• Main microfinance operators in the country with a focus on the products and services offered;
• Challenges facing the microfinance industry and small and medium enterprises in Yemen;
• Future opportunities and recommendations to develop the microfinance sector in the country.