21. Private Investment as a Financing Source for Microcredit
- Author:
- Carter Garber
- Publication Date:
- 01-1997
- Content Type:
- Working Paper
- Institution:
- The North-South Center, University of Miami
- Abstract:
- In this paper, economist and development finance consultant Carter Garber examines the process of complementing donations and commercial bank credit with private investments as a source of capital for international microenterprise finance. First, he describes the large expectations for private capital in the rapid growth of microenterprise finance. Second, Garber discusses the varied sources of private capital, especially those involving socially responsible investment. The third and central section is an examination of eight “socially responsible investment” mechanisms that currently channel $27 million of U.S. private credit to microfinance lending institutions. Garber demonstrates the variety of available mechanisms and examines their track record to date. The final section identifies policy changes that will be necessary for these types of private investment in microenterprise to grow fast enough to meet the expected demand during the coming decade.
- Topic:
- Economics and International Trade and Finance