USAID's Contribution to Microfinance

This paper describes the path that USAID followed in supporting the microfinance industry since its formation in the 1960s, primarily from the perspective of the USAID/Washington. USAID's efforts to support microfinance coalesced under the Microenterprise Initiative, which began in 1994. Under the Initiative, USAID created the USAID/Washington Office of Microenterprise Development, which became the Agency's focal point for microfinance programming providing technical direction and industry leadership. In the years that followed, an appreciation for the broader role that microfinance could play in USAID programming took hold with USAID Missions throughout the world support the development of microfinance institutions and working with host governments to create policies and legislation that enabled microfinance to take its rightful place in the banking sector. Today microfinance programming is evidenced throughout the Agency both formally, through economic growth activities, and informally, through programs designed to help some of the world's poorest populations meet their most basic needs.