Environmental Sustainability and Microfinancial System: What is the Link?

In recent years, millions of poor people worldwide have benefited from microfinance activities, such as microcredit, microsaving and microinsurance, making this range of financial services a key-tool for economic growth of many developing countries. At the same time, the concept of Sustainable Development (SD) has taken on an increasing importance in the debate on economic growth and the environment. After exploring the relationship between microfinance and SD in developing areas, this study supports the view that microfinance institutions should implement policies that aim both at making compatible the loans they provide with the environment and at encouraging the diffusion of environmental awareness across borrowers