What are credit appraisal techniques?

The lender satisfies himself of the good intentions of the borrower, usually through an interview. Small business appraisal by financial intermediaries can be categorized into four main distinct credit appraisal techniques – financial statement lending, asset-based lending, credit scoring, and relationship lending.

What are the key benefits of microfinance institutions?

Advantages of Microfinance Company

• Collateral-free loans.
• Disburse quick loan under urgency.
• Help people to meet their financial needs.
• Provide an extensive portfolio of loans.
• Promote self-sufficiency and entrepreneurship.
• Harsh repayment criteria.
• Small Loan amount.
• High-interest rate.

What is the national strategy for microfinance?

The vision is to have a viable and sustainable private micro (financial) market, with the government providing a supportive and appropriate policy environment and institutional framework to that market.

What are the types of appraisal done by financial institutions?

Four broad areas of appraisal by banks are market, management, technical and management.

How do you think microfinance can help improve the quality of lives of the poor?

Microfinance can break down these barriers. It helps low-income households to stabilize their income flows and save for future needs. In good times, microfinance helps families and small businesses to prosper, and at times of crisis it can help them cope and rebuild.

How do microfinance institutions work?

Microfinance institutions offer “microloans” to borrowers along with assistance (financing a new business or an expansion plan, paying for urgent family needs, facilitating mobility to obtain a job, etc.), despite the fact that these borrowers do not offer a solid guarantee of repayment.

How would you benefit from this microfinance Strategy?

What is the purpose of microfinance institution?

Microfinance is an economic development tool whose objective is to assist the poor to work their way out of poverty. Its main objective is to provide a permanent access to appropriate financial services including insurance, savings, and fund transfer. It is rather an important tool for the eradication of poverty.

How is microfinance beneficial to the Philippines?

Microfinance, or the provision of financial services such as loans to poor families, is recognized as a potent method of directly improving the lives of those most in need. The Philippine government has recognized the efficacy of microfinance and has made progress in promoting the development practice.

What is BSP’s policy for advocating microfinance?

The BSP’s policy for advocating microfinance is to be able to reach a larger number of entrepreneurial poor. The BSP is encouraging the establishment of microfinance-oriented banks, and microfinance operations in existing banks.