CIDA's Microfinance Guidelines: Supporting the Development of Inclusive Financial Systems

These guidelines provide Canadian International Development Agencys (CIDA) officers with advice on what to look for when planning, identifying, monitoring, and implementing a microfinance initiative. The guidelines focus on microfinance initiatives for the economically active and low-income poor, with a particular focus on poor women. They include the following:

• Microfinance best serves individuals who have some form of income generating activity or have the funds to participate in saving services;
• Improving women's access to finance services requires gender sensitive design;
• Efforts need to be made to develop capabilities and expand access to resources for young entrepreneurs;
• CIDA should avoid providing loan capital to informal institutions, and instead, should support them by providing training, capacity building, and technical assistance;
• CIDA can support formal institutions by providing technical assistance to enable them to expand outreach and improve their product offering and delivery.

Finally, the guidelines give advice on planning, monitoring and evaluating support to MFIs, assessing MFI financial and social performance, building industry infrastructure, fostering an enabling policy environment and partnerships with other countries.