§ The Earl of Sandwichasked Her Majesty's Government:
Whether they support the global campaign to reach with micro-lending 100 million poor people by 2005, launched by the World Bank at the 1997 Micro-Credit Summit; and what progress has been made towards this objective. [HL2262]
§ Baroness AmosWe are actively supporting organisations engaged in the provision of micro-finance, principally in South Asia and Sub-Saharan Africa. Our commitment in this sector has grown significantly in recent years to about £75 million.
The Department for International Development (DFID) is a member of the Donor Agency Council of the Micro-Credit Summit and has met its obligation to submit an institutional action plan. Representatives of DFID are participating in the annual Micro-Credit Summit Meeting of Councils. DFID also participates in other international fora such as the Consultative Group to Assist the Poorest (CGAP), where we work to improve best practice and develop internationally agreed performance standards for micro-finance institutions. The global campaign to reach 100 million poor people by 2005 was not launched by the World Bank but by the organisers and participants of the 1997 Micro-Credit Summit.
DFID support to micro-finance practitioners is directed to those which provide micro-financial services—savings and insurance as well as credit—with maximum outreach to poor people on a sustainable basis. An example is BRAC, in Bangladesh, which has about 2.8 million members of its micro-finance programme, which represents a near 50 per cent. increase over the last two years. Overall, in South Asia alone, DFID is funding micro-finance institutions which provide about 5 million poor people with credit and over 2 million of these have been added since the first Micro-Credit Summit in 1997.
DFID is concerned to ensure that the rapid expansion of micro-finance does not compromise internationally accepted best practices and in particular that micro-finance institutions are able to ensure that effective and transparent mechanisms for governance and management are in place, especially to safeguard the savings deposits of poor people.