The term “microfinance” describes financial services for poor people. This involves a diverse range of products and services, including savings, insurance and loans. What makes microfinance different from mainstream finance, however, is that the amounts of money involved are typically small, such as loans of a few hundred pounds or less, and that the services may be offered in innovative ways, such as lending to groups instead of individuals.

Recently there have been changes in some parts of the microfinance industry, as some organisations start moving towards a more commercial mind-set and investment banks become involved in financing services. RESULTS is working to ensure that these changes do not put poor users of microfinance at a disadvantage, and that their wellbeing is not sacrificed for profit.

RESULTS is doing this by engaging with microfinance organisations and funders, including the World Bank, the UK Department for International Development and others, to promote initiatives like the UN Principles for Investment in Inclusive Finance, which outline rules and steps that investors can take to improve social impact. There are many international organisations and investors that have yet to adopt the Principles, and RESULTS is working actively with some of the world’s biggest investors in microfinance to encourage more responsible investment.

RESULTS is also working to move discussions of microfinance away from microcredit alone, so that more people in developing countries have access to savings and insurance. We do this through our own campaigning work, which you can read about here, as well as through our engagement with the All-Party Parliamentary Group on Microfinance, for which RESULTS hosts the Secretariat.