Micro-Finance in Rural Communities in Southern Africa: Country and Pilot Case Studies, Policy Issues and Recommendations

Micro-Finance in Rural Communities in Southern Africa is the report prepared for the Integrated Rural Development Program (IRDP) of the W.K. Kellogg Foundation, Southern Africa by the HSRC. The IRDP is a core initiative in Foundation's Africa portfolio of programmes, which aims to reduce poverty and improve the quality of life of rural communities. A component of this programme is to help capitalise locally based enterprise development initiatives by stimulating the provision of and access to micro-finance in rural areas. Three sites were selected to pilot the introduction of this and other IRDP activities. These were Chimanimani (Zimbabwe), Chimoio (Mozambique) and Nyandeni (South Africa). As part of this initiative, the Human Sciences Research Council (HSRC) evaluated the implications of implementing a micro-finance scheme in these areas. While micro-finance in its various forms has helped to make loan capital more accessible to low-income rural communities, much remains to be done to increase its outreach, impact and sustainability. The study makes well-researched recommendations for IRDP policy and strategy to maximize improvements.