Protecting The Environment: Green Microfinance Or Green Micro Finance Institutions?

This paper represents a critical review of several papers and books written on the subjects of microfinance, poverty and environmental protection. It aims at linking the different themes and also to offer specific suggestions on how microfinance can provide solutions which are beneficial to the environment. The paper also concentrates on the disparities between rich and poor and how they influence the implementation of environmentally damaging activities. These activities are in fact implemented with a clear damage to the poor, especially at local level, where the poor has difficulties to protect itself due to the differences in power between the rich and the poor. Particular attention is also dedicated to the issue of environmental sustainability vs. Microfinance Institutions’ sustainability since the promotion of environmental activities implies costs to be born by Micro Finance Institutions. In fact, it must be highlighted that sustainability is a fundamental issue for MFis. The majority of MFIs normally struggle for their existence, since their objective is to work with poor and difficult clients and they mainly operate in very difficult business environments. The financial sustainability of MFIs is therefore a crucial prerequisite for the provision of financial services to the poor layers of the population. Additional costs concerning environmental protection can be born only if adequate financial support is provided by external donor