Micro-finance in rural communities in Southern Africa: country and pilot site case studies, policy issues and recommendations

Micro-Finance in Rural Communities in Southern Africa was a report prepared by the HSRC for the Integrated Rural Development Program (IRDP) of the W.K. Kellogg Foundation, Southern Africa. 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 are: Chimanimani (Zimbabwe), Chimoio (Mozambique) and Nyandeni (South Africa). As part of this initiative, the Human Sciences Research Council (HSRC) conducted an evaluation in the three key sites of the IRDP, to evaluate 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 essential objective of this study is to make well-researched recommendations for IRDP policy and strategy to enable the micro-finance agents that it will shortly be appointing to maximize improvements in these key indicators in the three pilot sites