Rural Finance Policy

This document provides guidance to International Fund for Agricultural Development (IFAD)-supported rural financial services, programs and projects, and their components.

IFAD concentrates on developing inclusive rural financial systems and fostering innovations to increase the access of the poor to a wide range of financial services. It applies six guiding principles in its rural finance interventions:

• Support access to a variety of financial services;
• Promote a wide range of financial institutions, models and delivery channels;
• Support demand-driven and innovative approaches;
• Encourage market-based approaches that strengthen rural financial markets, avoid distortions in the financial sector and leverage IFAD's resources;
• Develop and support long-term strategies focusing on sustainability and poverty outreach;
• Participate in policy dialogues that promote an enabling environment for rural finance.

IFAD plans to apply these binding principles at the micro level, working with retail rural finance institutions and beneficiaries; at the meso level, focusing on financial infrastructure, such as second-tier institutions, and technical service providers; and at the macro level, assessing the policy, legislative, regulatory and supervisory frameworks.