THE TRANSFORMATION PROCESS IN MICROFINANCE INSTITUTIONS

SRNEC K., DIVIŠOVÁ M., SVOBODOVÁ E.

Abstract
During the past 30 years, microfinance has been proven to be a powerful poverty alleviation tool. It is one of the only development tools with the potential to be financially self-sustaining. However, even after more than 30 years of industry effort, 80 percent of the working poor (more than 400 million families) are still without access to microfinance services. At current growth rates, the gap will not be closed for decades. For microfinance to achieve its potential as a global poverty alleviation tool, the microfinance industry must grow to scale (UNITUS, 2007). The article analyzes differences between informal microfinance institutions (MFIs) and formal types. In current 6-8 years proceeds the relatively intensive transformation process aiming to accelerate the transition from informal to formal microfinance structure. There will be still many people lacking access to financial sources if there is not the overall economy increase in given state. Although the transformations process has positive impact there are several negatives which are discussed in this article.

Key words:
microfinance institutions, microfinance, transformation, capital resources, poverty

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