UNDP Microfinance Assessment Report: Mongolia

How can UNDP help in the realization of the objectives of National Poverty Alleviation Programs?

The paper looks at the incorporation of microfinance in the Government of Mongolia's (GoM) strategy of National Poverty Alleviation Programme (NPAP), exploring donor interventions in the microfinance sector. It states that the United Nations Development Programme (UNDP) is an important supporter of the Mongolian Government's Programme of Action on economic growth under difficult transition conditions. It further explores local NGOs and cooperatives interventions in microfinance, suggesting ways of achieving successful microfinance administration in the poverty alleviation scheme. Looks at the methodologies and posits that the methods being used in Mongolia by some players not only increase the cost of delivery and thus reduce the prospects for sustainability, but they also dilute accountabilities and thus encourage poor loan supervision and ultimately poor repayment performance.

Concludes that:

  • While GoM's recognition of the importance of microfinance to poverty reduction is to be wholly applauded, its present microfinancing schemes are unlikely to either directly reduce poverty significantly or to positively move towards sustainability;
  • UNDP has a critical role to play in the realization of the objectives of the Mongolain government as it activities brings together many partners in support of sustainable human development in Mongolia.

About this Publication

By Hussain, F.