The number is huge: 137.5 million people who received a microloan in 2010, according to a report released today by the Microcredit Summit Campaign.
If we assume that families have an average of five members, it means that these 137.5 million microloans affected more than 687 million family members, which is greater than the combined populations of the European Union and Russia.
The report was relesead in view of the Microcredit Summit Campaign 2011 which will be held in Valladolid, Spain, from November 14 to17. The event, which is entirely dedicated to analyse the effects of microloans, will be inaugurated by Her Majesty Queen Sofía and Nobel Peace Prize laureate and Grameen Bank founder, Muhammad Yunus. “At the first Microcredit Summit in 1997, only 7.6 million of the world’s poorest families had been reached,” said Prof. Yunus. “While the growth in numbers has been inspiring, we must keep our attention on the wisdom from the clients. The report tells us that when asked what they want for themselves and their families, their answers include, ‘education for their children, health for their family, decent housing that keeps the rain and cold out, and regular, nutritious meals.’
According to the report, over the last 13 years, the number of very poor families with a microloan has grown more than 18-fold from 7.6 million in 1997 to 137.5 million in 2010. The latest data comes from more than 3,600 institutions worldwide, with more than 94 percent of the information having been collected within the last 18 months. While in 2010 more than 205 million people worldwide received a microloan in 2010, this multi-year campaign focuses on outreach to the poorest clients.
However microfinance has faced setbacks as well. An initial public offering of SKS, a microfinance institution (MFI) based in Andhra Pradesh, India, was followed by charges of over-indebtedness and suicides among clients in that state, resulting in a clamp-down by the state government last October.
“While our progress has been stunning, the challenges in Andhra Pradesh and elsewhere will take a toll,” said Campaign director Sam Daley-Harris. “As of August 31, 2011 when this report was completed, the situation in Andhra Pradesh had not yet improved, and repayment rates of MFIs there were reported as low as 10 percent. Were we, therefore, to deduct 90 percent of the Andhra Pradesh numbers from our calculation of clients reached, we would see nearly 200 million total clients and more than 132 million poorest clients reached in 2010. This represents more than 5 million clients who received loans in 2010 but may not receive loans in 2011.”
The State of the Microcredit Summit Campaign Report 2012 sets the tone for several of the more than 100 sessions scheduled for the Global Summit. The Campaign aims to reach 175 million of the world’s poorest families by 2015 and ensure that 100 million of those families move above the World Bank’s $1.25-a-day poverty threshold.
