For those documents that are not available for download in PDF, please contact the Social Finance Programme secretariat for a copy: SFP@ilo.org

WP 41: Microlending in Germany - (pdf 815 Kb)
C. Kreuz, 2006

Microfinance is generally associated with attempts to reduce extreme poverty. However, the causes that gave rise to microfinance in low income countries in the early 1980s can also be found in high income countries, obviously less pervasive and affecting a much smaller number of people.

The study by C. Kreuz shows how initiatives outside the commercial banking sphere seek to fill the credit gap in Germany. The creation of the DMI (“German Microfinance Institute”) in 2004 signals the growing awareness that there is a real need to expand the institutional supply of small scale financial services even in a country disposing of a very diversified and broad financial market. Recent legislation to facilitate combined grants and loans to job seekers that want to set up their own very small business (“Ich AG”) further emphasize the need for innovative solutions.

Microfinance for self-employment in industrialized countries. Good Practice Guide - (pdf 275 Kb)
edited by B.Balkenhol, 2003, ILO.

The Good Practice Guide is an outcome of an ILO action program that examined in 1999-2000 the costs and benefits of microfinance programmes for self-employment. This review covered seven industrialized countries with widely differing policies and schemes: Canada, France, Germany, Ireland, the Netherlands, the United Kingdom and the United States. The review found that often schemes failed to reach a large enough number of clients to be cost-effective. In other cases costly advisory services jeopardized the financial stability of a scheme. Perhaps the greatest challenge for managers of self-employment schemes is the ad hoc nature of government grants. Self-employment promotion is still largely seen as a temporary, anticyclical labour market measure. This guide provides managers in charge of self-employment promotion schemes with the tools to enhance the performance of their programmes. It focuses on common, recurring problems that are typically encountered when setting priorities, selecting staff, managing finances, tracking performance and more. It offers numerous examples of best practice as well as an extensive list of resources, references and helpful websites.

The Role of Microenterprise Development in the United States. A research report by John Else, Karen Doyle, Lisa Servon, Jon Messenger, 2001.

Is micro-finance an anti-poverty strategy also in industrial economies? The target groups to which it would probably apply were the unemployed, people on welfare, the working poor. The book examines the quality of self-employment performance measures for MFIs and support programmes and the case for public support.

From unemployment to self-employment: The role of microfinance in the United Kingdom, A research report of the National Institute for Economic and Social Research, London for the ILO, 2000.

Governments in a number of countries in North America and Western Europe seek to encourage the growth of micro-enterprises as one part of efforts to combat unemployment. Programmes are to encourage the unemployed, the young, welfare recipients and disadvantaged groups in the population to set up their own small businesses. One important component is the provision of micro finance. The book looks at the performance of such self-employment promotion programmes in the United Kingdom. It also examines what needs to be done to maximise economic and social benefits and minimise social costs: to make self-employment and micro-enterprise activities lasting and stable. The intention is to address the information needs to governments on how to fine-tune incentives.

Enterprise Creation by the Unemployed in Ireland: The Role of Microfinance. C. Duggan, R. Immink, P. Kearney, C. O’Shea, 2000.

The book reviews the performance of self-employment programmes in Ireland. It examines whether self employment is a viable option for the long term unemployed and how microfinance can contribute to a successful transition from unemployment to self-employment. This is followed by an assessment of the usefulness of support measures. The book concludes with policy recommendations to government and programme managers.