Microfinance Horizon

Author: Ragab Kayastha

Abstract:

Microfinance is an effective tool for poverty reduction of rural areas in Nepal. Especially from 1990s, the development of microfinance institution (MFIs) has contributed to diminish the poverty of the country comparatively than previous days, by providing microfinance to the poor people. But still more than 25% of the total population is under poverty (Microfinance Summit Nepal, 2010). To make these microfinance institutions more sustainable as well as more accessible to the poor is a crucial agenda for the country. There are several factors affecting the sustainability of MFIs, and governance is one of them. In this paper, there are explanations of 2 types of governances. One type of governance is the governance inside the MFIs, which is distinguished as corporate governance. The other is governance as a policy body, the system of Government regarding microfinance policy in Nepal.

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