Paper

Prospects, Problems and Potential of Credit-Granting NGOs

Can NGOs be regarded as ideal providers of credit to small and micro businesses?

Investigates whether this claim is justifiable and questions whether co-operation between donor institutions and NGOs should be restructured.

Describes experiences of NGOs as financial intermediaries to date. Further reports results of an empirical investigation on the financial efficiency of credit-granting NGOs in Latin America. These findings reveal serious doubts on the ability of NGOs to be viable financial institutions.

Suggests, as a promising alternative, that collaboration should be undertaken with NGOs focusing on institutional building and outlines stages of this process. In this scenario, donors would have to assume a much more active role than that which they have played until now.

[Adapted from authors' abstract]

About this Publication

By Schmidt, R. & Zeitinger, C.
Published