A review of the economic and social impact of microfinance with analysis of options for the Mediterranean region

Resumen

The European Investment Bank was requested by Sanabel, the microfinance network of Arab countries, to prepare a study examining the economic and social impact of microfinance in the Mediterranean region. This study fills a gap in our knowledge of the microfinance industry in Mediterranean countries. Although many studies from other regions of the world, dating back to the 1990s, have been published in academic journals and subject to extensive review, the more recent impact assessment studies from the Mediterranean countries have until now been largely neglected. Much of this work exists in the domain of the microfinance institutions themselves rather than in the academic journals and therefore this study goes beyond a straightforward review of the academic literature. Indeed it was necessary to contact the microfinance institutions directly in order to get a comprehensive overview of this information, and the value added of the study is that it helps to better understand the regional perspective. Economic and social impact assessment has an important role to play in the development of the industry. At a strategic level, it helps to identify the way ahead and to support pragmatic solutions against a background of increasing and sometimes unrealistic expectations of what the industry can deliver. In addition, by informing on the outreach of microfinance, impact assessment plays an essential part in attracting funds from public sector donors and other stakeholders