Microfinance: Matthias Adler at TEDxRheinMainChange

Microfinance is a type of banking service that is provided to people living in poor area or people who cannot get access to normal financial services. This ensures that poor people can make a small loan which is usually a few hundred dollars to operate their own businesses and pay for their daily budget, healthcare and education with the profit they make.

This idea is especial popular in regions like Africa. The small amount of loans enables women in those poor areas to do their own small business and live a better life. A few hundred dollars loan is already enough for those 40% people who live in poor to make a big change. If they are financially independent, they could teach other people the skills they learned through operating their businesses and make loans to other people. As Matthias Adler says, microfinance is not only a business, but also a business operated with ethics. However, with the development of microfinance industry, there is potential risk that they will target on more reliable customers. Actually, the default rate in microfinance is really low. Therefore, it is important for microfinance to get mature and at the same time still help those who really need financial support.

Resources:https://www.youtube.com/watch?v=tCBzEn6dq10

http://www.investopedia.com/terms/m/microfinance.asp

http://www.opportunity.org/what-is-microfinance/#.UonT4bKt9hk

http://www.globalgiving.org/projects/provide-1000-microloans-for-rural-women-in-east-africa/

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