REACHING DOWN AND SCALING UP:

Into The Next Century

U.S. Agency for International Development

Microenterprise Results Reporting for 1998

September 1999

iii

Table of Contents

Acronyms v

Executive Summary ix

Introduction 1

USAID’s Role: Past and Present 2

Two Steps Forward, One Step Back 5

1998 Funding to Microenterprise 8

Poverty Lending 8

The Microfinance Frontier 9

Saving For A Rainy Day 9

Scaling Up Microfinance 10

Linking to the Formal Financial Sector 10

Microfinance Survey Findings 12

Business Development Services 16

BDS Providers 17

BDS Clientele 18

Reaching the Poor 19

Building Sustainable BDS Programs 20

The Policy Context 21

Into the Next Century 22

Annex A: Microenterprise Results Reporting 24

Annex B: Microenterprise Funding Sources 27

Annex C: Centrally-Funded Microenterprise Programs 28

Annex D: Summary of USAID Microenterprise Funding by 

Country, 1990-1998 31

Cover photo courtesy Aid to Artisans/Kyrgyzstan

v

Acronyms

AIMS Assessing the Impacts of Microenterprise Services Project

ARIES Assistance to Resource Institutions for Enterprise Support

ANE Asia and the Near East Region (USAID)

ATA Aid to Artisans

BDS Business Development Services 

BHR/PVC Bureau for Humanitarian Response/Office of Private and

Voluntary Cooperation

BRAC Bangladesh Rural Advancement Committee

BRI Bank Rakyat Indonesia

CEM Caisse d’Epargne de Madagascar (National Savings Bank of 

Madagascar)

CGAP Consultative Group to Assist the Poorest

CIS Office of Credit and Investment Staff

CRS Catholic Relief Services

CUES Credit Union Empowerment and Strengthening

CWE Credit with Education

DA Development Assistance

DFA Development Fund for Africa

E&E Europe and Eurasia Region (USAID)

EEPA Employment and Enterprise Policy Analysis Project

ENI Europe and the New Independent States Region (USAID)

ESF Economic Support Funds

FFH Freedom from Hunger

FFP Private Financial Fund

FHI Food for the Hungry, Inc.

FIE Centro de Fomento a Iniciativas Economicas

FSA Freedom Support Act

FY Fiscal Year

GEMINI Growth and Equity through Microenterprise Investments and 

Institutions 

IGP Implementation Grant Program

ILO International Labor Organization

JRF Jordan River Foundation

K-Rep Kenya Rural Enterprise Programme

LAC Latin America and the Caribbean Region (USAID)

vii

MBP Microenterprise Best Practices Project

MFI Microfinance Institution

MIP Microenterprise Innovation Project

MRR Microenterprise Results Reporting

NGO Non-Governmental Organization

NICO Nabunturan Integrated Cooperative

NIS New Independent States 

NOA New Obligating Authority

NRB Nsoatreman Rural Bank

PISCES Program Investments in the Small Capital Enterprise Sector

PRIME Program for Innovative Microenterprise Expansion

PVO Private Voluntary Organization

SAI Special Assistance Initiative

SEEP Small Enterprise Education and Promotion Network

USAID United States Agency for International Development

VITA Volunteers in Technical Assistance

WOCCU World Council of Credit Unions

ix

Executive Summary

Millions of households around the world rely on microenterprises as regular employment to provide the income that pays for food, clothing, shelter,

school books and fees, and medical bills. During times of economic distress

and special need, additional households also use informal business activities to

generate essential income. 

The United States Agency for International Development (USAID) has

long promoted microenterprise development as an important strategy for

assisting households at the lowest income levels. As the lead bilateral donor

in this area, USAID is committed to investing in microenterprise development

as a means of encouraging economic growth while maintaining strong support

for those programs that make a special effort to reach poor households.

Through its institutional partners, USAID extends its own reach and leverages

resources from other sources so that microenterprise assistance organizations

can become economically viable players in the community. 

USAID pledged support to the microenterprise development community

One Microentrepreneur’s Story

During Hurricane Mitch, heavy rains caused serious flooding in

northern Nicaragua. Many were forced from their homes as the

water level rose above a meter. Estebana Carrión spent an entire

night under her hut’s badly damaged roof, where she desperately

hung to a pole with her three small children clinging to her. The next

day, when Estebana and her children inspected their small hut, they

saw that the wooden walls had caved in and the straw roof had collapsed.

Prior to the hurricane, Estebana was a vegetable vendor in

Chichigalpa and a client of ProMujer Nicaragua, a USAID-supported microfinance institution active in the area. The hurricane

destroyed her valuable business assets such as buckets, produce

baskets, and a 100-lb. bag of beans. Immediately after the hurricane, she restarted her business with her savings and began selling

tomatoes in Chichigalpa. Today Estabana is rebuilding her home

and her income. (Source: ProMujer) Estabana Carrión with 2 of her children.

Courtesy ProMujer/Nicaragua
Reaching Down and Scaling Up: Into the Next Century

x

nance programs and strengthen business

development programs assisting microenterprises to grow beyond the survival

stage.

■ Of the 1998 funding to microenterprise, 68 percent went to financial

services programs and 32 percent

supported business development services and other non-financial activities. 

■ Non-governmental organizations

(NGOs) and international private

voluntary organizations (PVOs)

comprised 73 percent of the 654

institutions supported through active

USAID funding agreements in 1998.

These organizations are engaged in a

variety of services and activities to

assist microentrepreneurs, including

financial services such as savings and

credit; business development services such as business skills training,

information and market access services; and policy advocacy and

research.

■ In 1998, USAID supported financial

activities in 61 countries and business development programs in 39

countries.

■ Organizations providing business

development services reported that

in 1998 they had over 2.2 million

clients; 80 percent of these clients

were in rural areas where improved

access to market outlets and cost saving technologies are critical needs.

Most (62%) of the businesses

assisted are agriculture-related. The

majority of the USAID-supported

business service organizations provide training, on-site technical assistance, and help with marketing linkages between buyers and sellers. 

■ Many business service organizations

have focused their activities on poor

in its Microenterprise Initiative, launched

in 1994 and renewed in 1997. The accomplishments of 1998 go beyond prior years

in fulfilling agency objectives to assist

poor families achieve access to financial

services and improve the quality of their

enterprise activities. 

■ USAID’s emphasis on scaling up

microfinance programs contributed

to a record number of clients 

being served through microfinance 

programs in 1998, with 3.5 million

clients with active loans totaling $1.3

billion.

■ Average loan size for USAID-supported programs was $389, with

lower average loans in Africa ($170)

and Asia and the Near East ($249). 

■ Of the active loans, 83 percent had

an initial loan size of either less than

$300 (for Africa, Asia and the Near

East, and Latin America) or less than

$1000 (for Europe and Eurasia).1 63

percent of the funds for financial service institutions were applied toward

poverty lending programs.

■ In 1998, 5.1 million persons, with

savings of over $800 million, 

participated in USAID-supported 

savings programs. For USAID-supported institutions, this is an increase

of 139 percent in the number of

savers from 1997. 

■ Women comprised 84 percent of all

USAID-supported microfinance clients.

■ There was 95 percent loan repayment in these programs on the active

portfolio. 

In 1998, USAID again exceeded its

pledge of $135 million to microenterprise

development. Total funding to microenterprise programs was $138.4 million. This

represents a strong commitment by the

Agency to build on the success of microfi1 The Europe and the New The Independent States (ENI) Region is now the Europe and Eurasia (E&E) Region.
U.S. Agency for International Development Microenterprise Results Reporting for 1998

xi

entrepreneurs. USAID-supported

organizations reported that 97 percent of their clientele was in the lowest income segment for that country. 

■ USAID-supported organizations also

receive funding for improving the

policy and regulatory environment

for microenterprises and microenterprise assistance organizations. While

this represents a small proportion of

USAID funds – only 1.9 percent of

financial funding and 10.3 percent of

non-financial funding – efforts in this

area often lead to profound improvements in microentrepreneurs’ livelihoods and work environments.

In responding to crises in different

parts of the world in 1998, USAID recognized the important role of microenterprise development strategies in assisting

households to get back on their feet.

USAID will continue to seek appropriate

ways to support microenterprice development as a response to emergencies, as it

did in the case of Hurricane Mitch. 

Introduction

What are Microenterprises? 

USAID limits its definition of microenterprise to businesses with less

than 10 employees. A second defining characteristic is a low level

of assets and the low income of the business and its owner. Often

microenterprises involve only one person, the owner-operator.

Employees may be unpaid family members. Microenterprises

exist on the fringe of most formal economies, increasing in number when formal unemployment rises or when economic hardship

strikes. Microenterprise activities often complement farming, particularly in Africa, blurring the distinction between smallholder

agricultural and microenterprise assistance strategies. Typical

microenterprise activities are simple food processing, handicraft

production, repair services, dressmaking, and food vending. 

Millet Beaters in Mali

Photo by Nancy Key Dutton, Freedom From Hunger/Nyesigiso Credit

Despite the enormous growth in real wealth in the West in the last years

of the 20th century, millions of poor people throughout the world have been

left behind. One of the greatest development challenges has been to ensure

that the poor, wherever they are, share in the benefits of economic growth.

Even more challenging has been finding ways to extend economic opportunities to the most vulnerable: women, refugees, ethnic minorities, displaced persons, and the rural poor. 

USAID has long promoted microenterprise development as a key component of its strategy to alleviate poverty while promoting economic growth.

Microenterprise development programs strengthen communities by providing

services not otherwise available to poor entrepreneurs. USAID supports a

comprehensive approach to meet the needs of microenterprises, including

credit and other financial services such as savings, and non-financial business

development services. USAID also works to improve the policy environment

for microenterprises since all too often the playing field for microentrepreneurs is far from level.

This year’s annual report, “Reaching Down and Scaling Up: Into the Next

Century,” builds on the two primary themes for microenterprise development

that were addressed in last year’s report. Outreach to the poor and disadvantaged groups requires specific services and delivery techniques that have only
2 Reaching Down and Scaling Up: Into the Next Century

Courtesy Aid to Artisans/Kyrgyzstan

Aid to Artisans, Kyrgyzstan 

Aid to Artisans (ATA) has worked in Kyrgyzstan since 1995

as part of the USAID-funded Counterpart Consortium. ATA

provided training and technical assistance in organizational development, product design and development, production management and marketing to producer groups

throughout Kyrgyzstan. As a result, Kyrgyz felt-makers significantly improved their access to local, regional, and

export markets and now earn consistent income through

local craft fair sales, a retail shop in Bishkek, and export

orders from the U.S. and Europe.

2In 1989, USAID began tracking its annual funding to the microenterprise sector. Microenterprise Results Reporting (MRR), which provided the data for this

report, is now responsible for collecting data on the Agency’s microenterprise activities. MRR is funded through a MicroServe Indefinite Quantity Contract under

a task order to Weidemann Associates, Inc. Catherine Neill of Weidemann Associates wrote this report under the direction of Elizabeth Hunt and Katharine

McKee of the Office of Microenterprise Development.

recently become recognized as “best practice,” after 20 years of refinement in the

field. 

The second theme, increasing program size and scale, is evident in the large

number of microenterprise assistance

institutions developing new products and

services as a response to ever-growing

demand. The greater participation of

banks and other commercial institutions

in microfinance offers the potential to

address the financial needs of many more

entrepreneurs and households. Scaling up

is also the objective of many USAID-supported business development programs

that focus on improving the quality of

operations, productivity, and market

access of microenterprises. This allows

many more microenterprises to access 

the skills and information needed to go

beyond mere survival to achieve real

growth. 

As with previous annual reports, this

report highlights USAID’s progress in fulfilling the pledges of its Microenterprise

Initiative. USAID’s commitment is evident

from the findings of a survey of USAID

field missions and their partner institutions that are presented in this report. The

survey details the USAID-supported

financial and business development programs in fiscal year 1998. (See Annex A

for the survey methodology.) In addition

to the successes, the report addresses areas

where donors and practitioners continue

to face new challenges in meeting established goals.

USAID’S Role: Past and Present

In the past decade, USAID has provided more than $1 billion to microenterprise development.2 Prior to this time,
U.S. Agency for International Development Microenterprise Results Reporting for 1998 3

3From PISCES (Program Investments in the Small Capital Enterprise Sector) through ARIES (Assistance to Resource Institutions for Enterprise Support) and

GEMINI (Growth and Equity through Microenterprise Investments and Institutions), USAID’s support to centrally-funded microeterprise projects has made it a

leader in promoting sustainable financial service methodologies. In addition, research supported by these projects has accelerated an understanding of the

microenterprise sector and microentrepreneurs’ needs. 4For example, Bolivia has created a special type of institution called a private financial fund (FFP). FFPs are regulated financial intermediaries with a relatively

low minimum capital requirement. A number of NGOs that have evolved toward commercial operations have taken on this status, which permits them to 

mobilize savings and more readily borrow commercially to support expansion of services.

Photo by Carol Stigger, Opportunity International/Russia

Who are USAID’s Implementing Partners?

Microenterprise assistance institutions include international PVOs,

local NGOs, business associations, credit unions and cooperatives, banks, other commercial entities and academic research institutions. (See Annex A for a breakdown of USAID’s portfolio by institution type.) As the microfinance field has grown, new organizations have appeared on the scene, mostly evolving from NGOs.

Non-bank financial institutions (and the regulatory instruments for

supervising them) have been created in a number of countries to

specifically serve the needs of the microenterprise community.

While regulated, they are not governed by the same laws as

banks.4 Of the 654 institutions supported through active USAID

funding agreements in 1998, PVOs and NGOs comprised 73 percent. 

USAID funded a number of large

microenterprise projects with activities

spanning the globe.3 Since the late

1970’s, USAID has been the leading bilateral donor promoting microenterprise

development. Some of its earliest accomplishments came about through a strong

research agenda that brought attention to

the substantial size of the microenterprise

sector throughout the developing world

and laid the foundation for much of the

later work.

To achieve positive results from its

funding, USAID chooses its implementing partners selectively. USAID provides

resources to strengthen institutions that

deliver services to clients, helping the

institutions to improve their services,

expand their outreach, and enhance their

sustainability. USAID has long been a

leader in encouraging best practices

worldwide to build knowledge about what

does and does not work to accelerate the

field’s move up the learning curve. USAID

frequently sponsors innovative training

activities designed to disseminate best

practices and build field capacity.

In the area of impact assessment, the

Agency has taken a leadership role in supporting in-depth research to understand

the impacts of microenterprise programs.

It has also supported the development of

practical tools for use by practitioners to

assess client needs, and changes at the

client, household, and community levels.

Finally, in keeping with its role as a lead

donor in the field, the Agency has helped

spearhead several donor cooperative initiatives including the creation of the

Consultative Group to Assist the Poorest

(CGAP), housed at the World Bank.

CGAP now counts 26 multilateral and

bilateral donors among its members.
4 Reaching Down and Scaling Up: Into the Next Century

Hanan Walid Saher Alou Farha is a Group Lending and Savings member in the

Mahatta urban refugee area in Jordan.

Photo by Susan Warner, Save the Children/Jordan

The Microenterprise Initiative

By 1994, USAID was convinced of the importance of microenterprise development as a cornerstone of broad-based economic

development. That year, with the critical support of the

Microenterprise Coalition and some members of the U.S. Congress,

the Agency launched a special Microenterprise Initiative. The

Initiative was renewed in 1997. 

Through the Microenterprise Initiative, USAID has committed to:

(1) Maintaining women and the poor as its primary 

priorities, particularly through support for poverty lending, 

(2) Helping implementing organizations to reach greater 

numbers of people;

(3) Supporting a commitment to institutional sustainability 

and financial self-sufficiency among implementing 

organizations; and

(4) Seeking improved partnerships with local organizations.

The renewal of the Microenterprise Initiative included a number of

quantitative targets for the Agency and its partners.

■ At least half of all microenterprise clients of USAIDsupported institutions will be women. 

■ At least half of all the USAID funds provided to microfinance institutions will be used to support poverty 

lending.

■ At least two-thirds of the clients of the USAID-supported 

microfinance institutions will receive poverty loans.

■ The average repayment rates for USAID-supported microfinance institutions will be 95 percent or above.

■ Every USAID-supported microfinance organization will 

have a plan for reaching full financial sustainability 

within a credible period of time.

■ In addition, USAID has set a target of 15 percent annual 

growth in the number of clients receiving services.
U.S. Agency for International Development Microenterprise Results Reporting for 1998 5

Microfinance in the Wake of Natural Disaster

In the fall of 1998, USAID responded rapidly to the crisis in Central

America created by Hurricane Mitch. This late October storm caused

major damage, an estimated $5 billion in Honduras, Nicaragua, El

Salvador, and Guatemala. By December, USAID was ready to unveil

the Hurricane Mitch Microenterprise Recovery Fund to which it allocated $5 million. The fund’s purpose is to ensure that local MFIs have

the available funds to respond to client needs as they rebuild. With

increased liquidity, microfinance institutions are able to provide emergency loans, can permit those most affected by the storm to reschedule

loan repayments, and can weather withdrawal of client savings.

USAID worked together with the Inter-American Development Bank,

which pledged $12 million, to develop complementary assistance

strategies. 

A June 1998 report commissioned by the Office of Microenterprise

Development addressed the role of microfinance institutions during

times of natural disaster and assisted in informing donors and practitioners on the best steps to take in recovery. This timely report made

useful suggestions on how microfinance institutions could best serve

their communities while ensuring their own survival. 

Following its experience with Hurricane Mitch, USAID’s Office of

Microenterprise Development brought together those who had

responded to and survived this crisis, including microenterprise practitioners and other donors. The Office is now funding the design of a

toolkit and other research activities to further inform the Agency and its

partners in their response to natural disasters. 

FINSOL client displaying her wares after Hurricane Mitch. 

Photo by Rohanna Mertens, ACCION affiliate FINSOL/Honduras. 

Two Steps Forward, 

One Step Back

The tale of microenterprise development after more than 20 years of support

by USAID and other donors contains

both successes and setbacks. In some parts

of the world, microenterprise institutions

have taken root and are displaying phenomenal results. Improvements in microfinance methodologies and advances in

program management have allowed a

handful of institutions to expand exponentially with far greater numbers of

clients and larger loan portfolios than ever

before. A trend among larger NGOs has

been to either join forces with commercial

banks or to become licensed as regulated

institutions. Such developments provide

an important benchmark in the microfinance field as it moves from experimentation to proven success and expansion. 

At the same time, within the regions

where MFIs have flourished there have

also been disasters, both economic and

natural, that have stressed microenterprises and the households that depend on

them. This, in turn, places pressing

demands on the financial institutions that

serve them. In Latin America, the devastation of Hurricane Mitch is still being felt. 

Throughout the world, conflict has

upended economies and created thousands of refugees. In these settings, local

microentrepreneurs struggle to make ends

meet for their families.
6 Reaching Down and Scaling Up: Into the Next Century

The Unit Desa System of Bank Rakyat Indonesia (BRI) Rides

the Storm

Beginning in mid 1997 and within the span of one year, Indonesia saw its

currency fall in value by 80 percent while inflation soared to 50 percent.

Economic recession hit hardest in the private sector, which resulted in largescale layoffs. Microenterprises, particularly in rural areas, were less severely

affected by the crisis but still experienced a slowdown in demand.

Unfortunately, this crisis struck when Indonesia was experiencing its worst

drought in 50 years. Drought appears to have had a more powerful effect

on much of the rural economy than did the crisis. 

When much of Southeast Asia began reeling from the waves of the financial

crisis, BRI’s Unit Desa System continued to thrive. The 3,700 Unit Desas

located throughout Indonesia are small bank offices acting as individual

profit/loss centers. Each unit makes micro loans and provides savings and

time deposit accounts. The Unit Desa system, with a long history of USAID

support, reported 2.5 million loan customers in 1998. Despite the problems

felt by microentrepreneurs and low-income households in general, reduced

demand for products and increased prices, loan repayment by microentrepreneurs and fixed-income households remained at over 97 percent and long

term losses at under 2.2 percent. 

But the most dramatic story has been the jump in savings held by BRI Units,

as customers moved their savings to financial institutions in which they had

confidence. Many private banks experienced runs and eventually closed

leading the Bank of Indonesia to guarantee deposits at all banks. By contrast, the Unit Desas actually reported a sharp increase in savings accounts,

totaling over 20 million in 1998.

BRI Unit Desa customers making wayang or shadow puppets. 

Courtesy BRI/Indonesia

FINCA/Azerbaijan: One Courageous 

Woman

Many of FINCA/Azerbaijan’s clients are refugees

from the on-going conflict between Azerbaijan and

Armenia. 

Laura Hanum is a refugee from Fizuli. She lives in Baku

with her family. When she heard about FINCA, she

was out of work, and her husband could find only

occasional employment. To make matters worse, one

of her children became very frightened during shellings

and developed epilepsy. 

When she heard about FINCA, she and several other

women in Baku decided to form a Village Banking

group. After a month of weekly meetings, the group

received their first loan. With her portion, Laura immediately went to the wholesale market and purchased

goods that she resold. She began doing a brisk business and started visiting the wholesale market once a

week. 

As a result of her efforts, Laura’s family’s life has

improved. Not only can she afford her son’s medical

treatments, she can also purchase foods for her family

that had been out of her reach, and in doing so has

improved their nutrition and health. (Source: FINCA)

In parts of Asia, the financial crisis has

left its imprint on the microenterprise sector, which once again has proven to be

surprisingly resilient. Prior to the Asian

financial crisis, some formal financial institutions had been very successful in

extending sustainable financial services

deep into the countryside. The most

notable of these institutions is BRI, which,

through its Unit Desa system, succeeded

in providing financial services widely and

profitably throughout rural Indonesia.

Economic uncertainty also reigns in

Africa, which remains largely agricultural,

and more vulnerable to economic crisis

brought on by drought and other causes.

Microenterprise activities play an essential

role in Africa, supplementing rural household income and providing important

employment opportunities during the

agricultural off-season. Important work

currently proceeding in Africa involves

adjusting microfinance tools developed in

urban areas to meet the needs of the rural

poor. Recent US legislation, The Africa:

Seeds of Hope Act, directs USAID to
U.S. Agency for International Development Microenterprise Results Reporting for 1998 7

Catholic Relief Services/Ethiopia

Aster Geste and her family left Eritrea and started a

new life in Wonji, Ethiopia, where she had relatives.

Not long after their arrival, her husband, an ex-soldier,

was arrested, leaving her alone and responsible for

their four small children. 

When Aster heard about the Women’s Savings and

Credit program sponsored by Catholic Relief Services

(CRS) in Wonji, she wanted to join right away.

CRS/Ethiopia started this program in 1994 with 30

members; it has since grown to 200 members. 

In 1994, Aster took out her first loan of about $25.

She started making and selling injera, a local bread.

Once that loan was paid, Aster took out a loan for

twice that amount to rent some land near the Awash

River, a three-hour round-trip from her home. There she

was able to harvest vegetables four times a year with

her husband who had returned. 

With her third loan of about $80, Aster rented another

piece of land. Then, in October 1996, the Wonji area

was hit by a severe flood, causing Aster to lose half her

harvest. Aster still paid off the loan on time! Since that

time Aster has taken out two more loans, rented more

land, and planted more vegetables. With a recent loan

she purchased a water pump that has enabled her to

expand her business and earnings.

TABLE 1. 1998 Microenterprise Funding by Region

Amount Percent Amount Percent Amount Percent

$ % $ % $ total funding

(US mil) (US mil) (US mil) %

Africa 20.8 56 16.6 44 37.4 27.0

Asia/Near East 32.8 78 9.3 22 42.1 30.4

Europe/Eurasia 13.4 69 5.9 31 19.3 14.0

Latin America/

Caribbean 24.4 75 8.0 25 32.4 23.4

Worldwide 2.6 36 4.6 64 7.2 5.2

Total 94.0 68 44.4 32 138.4 100

5The U.S. Congress enacted the Seeds of Hope legislation (PL 105-385) on November 13, 1998. The purpose of this bill is to “to support sustainable and

broad-based agricultural and rural development in sub-Saharan Africa.” In particular, Section 102 directs USAID to use microenterprise assistance “to improve

the capacity and efficiency of agricultural production in sub-Saharan Africa of small-scale farmers and small rural entrepreneurs.” This section also directs working with other organizations assisting microenterprise to “...develop a comprehensive and coordinated strategy for providing microenterprise assistance for subSaharan Africa.”

Aster Geste with her water pump.

Photo by Tshainesh Mesele, Catholic Relief Services/Ethiopia

develop microenterprise assistance strategies that better reach and support smallscale farmers and rural entrepreneurs.5

To meet the growing challenges in

Africa and build on USAID’s commitment

to the region, USAID’s Office of

Microenterprise Development has

launched an in-depth consultative process

involving the Africa Bureau, USAID missions, other donors, and implementing

partners to develop a microenterprise

assistance strategy tailored to African

needs and opportunities. Through consultation and collaboration, USAID will continue to advance its African programs,

with particular emphasis on extending services to rural areas and farm-based families. 

Within this evolving context, USAID

has maintained a leadership role. This role

can be seen in the Agency’s responses to

1998 events and in its on-going efforts to

strengthen microenterprise development

programs worldwide.

Financial Programs

Business

Development

Programs Total
TABLE 3. Percentage of USAID Funds Committed to 

Poverty Lending by Region, 1998

Finance Percent of

Total Programs Financial

Microenterprise Funding for

Funding to Region Amount Poverty Lending

(US mil) (US mil) (%)

Africa 24.4 10.3 56

Asia/Near East 37.0 28.8 59

Europe/Eurasia 18.9 13.0 72

Latin America 21.0 14.2 63

Central Bureaus 37.1 27.7 62

Total Bureaus 138.4 94.0 63

8 Reaching Down and Scaling Up: Into the Next Century

Poverty Lending

Because USAID is committed to promoting microfinance programs that reach

the poor, it has pledged to ensure that at

least half of the money used for financial

programs will support poverty lending

programs. 

Table 3 demonstrates that in 1998,

USAID met and exceeded its pledge.

TABLE 2. 1998 Microenterprise Funding by USAID 

Bureau

Amount Percent Amount Percent Amount Percent

$ % $ % $ total funding

(US mil) (US mil) (US mil) %

Africa 10.3 42 14.1 58 24.4 17.6

Asia/Near East 28.8 78 8.2 22 37.0 26.7 

Europe/Eurasia 13.0 69 5.9 31 18.9 13.7 

Latin America/

Caribbean 14.2 68 6.8 32 21.0 15.2

Central 27.7 75 9.4 25 37.1 26.8

Total 94.0 68 44.4 32 138.4 100.0

1998 Funding to

Microenterprise

In FY 1998, USAID again exceeded its

pledge of $135 million to microenterprise

development. Total microenterprise funding for all regions was $138.4 million. Of

this, 68 percent was directed towards

Financial Programs

Business

Development

Programs

Total

financial programs and 32 percent channeled into non-financial programs.

Financial services included funds for loan

capital, institutional strengthening of

microfinance institutions, and policy work

directly affecting microfinance institutions. 

Non-financial services, or business

development services, included all other

enterprise support work, such as technical

assistance to poor entrepreneurs in marketing, production and distribution.

Policy advocacy to improve the environment for microenterprises is also included

under business development.

Funding spent in each region is shown

in Table 1. Worldwide programs are headquartered in North America and working

on a global basis.

Central bureau funds augmented funding by the regional bureaus for Africa,

Asia and the Near East, and Latin America

by $13 million, $5 million and $11 million, respectively. 

Table 2 indicates the amounts spent

on microenterprise by each USAID

bureau. Funding proportions for financial

and business development programs for

all bureaus have changed little since 1997,

with the exception of the Africa Bureau,

which spent a greater portion on financial

programs in 1998 (34% in 1997 vs. 42%

in 1998) as microfinance methodologies

were applied more successfully to the

African context. The Africa Bureau continues to support a large number of business development activities.
U.S. Agency for International Development Microenterprise Results Reporting for 1998 9

6The AIMS (Assessing the Impacts of Microenterprise Services) project is funded by USAID’s Office of Microenterprise Development. Impact assessments

conducted in Uganda, India, Zimbabwe, and Peru under the AIMS Project and numerous other reports on the impact of microenterprise programs are available

online at www.mip.org. 7See John Hatch and Laura Frederick, “Poverty Assessment by Microfinance Institutions: A Review of Current Practices.” Microenterprise Best Practices Paper,

August 1998.

Measuring the Impact of Microenterprise Assistance on the

Poor 

Over 80 countries have established baselines for poverty developed from

income and consumption estimates. Yet these standards shed little light on the

actual poverty conditions in which so many people live. USAID’s AIMS

Project6 is actively engaged in the search for improved poverty measures and

field-based analysis of the impact of microenterprise development programs

on the poor. USAID has funded studies that have begun to build a database

as a foundation for understanding how microenterprise assistance strategies

affect the economic status of microenterprise clients. This database goes

beyond traditional income determinants of economic status, which have

proved difficult to measure, to focus on assets, risk, and vulnerability for

microentrepreneurs. Assets, such as land, housing or equipment, for example, are extremely helpful to households during times of unexpected crisis.

Assets are a source of liquidity and can be used as loan collateral.7

The Microfinance Frontier

SAVING FOR A RAINY DAY

USAID’s leadership in promoting

innovative and sound approaches to

microfinance is widely recognized among

donors and practitioners. While many

think of only credit when they hear the

word ‘microfinance,’ there is much more

to financial services than credit. One of

the most important financial services provided by some microfinance institutions is

access to safe vehicles for savings and

deposits. Especially during times of

upheaval or uncertainty, ready access to

savings becomes critical to a household’s

ability to weather crises. 

Savings: The Most Basic Financial Service

USAID/Madagascar’s microenterprise activity, under

the Financial Market Development Project, provides

support to the Caisse d’Epargne de Madagascar

(National Savings Bank of Madagascar or CEM), the

country’s foremost governmental financial institution

serving low-income households.

Since 1993, USAID has provided almost $1 million in

technical assistance and training to improve CEM’s

financial management practices, its financial sustainability, enhance its customer service, and upgrade its

management information technology and systems. The

intent has been to guide the CEM’s transition into an

independent financial services institution. 

Prior to USAID support and assistance, the CEM did

not receive interest on its deposits at the National

Treasury. By placing conditions on its assistance,

USAID has enabled the CEM to offer its clients competitive interest rates and at the same time experience

considerable growth in its asset base—a necessary

precondition for its disengagement and independence

from the state. In real terms, the CEM’s asset base,

now $19 million, has more than doubled since 1993. 

USAID/Madagascar plans to give CEM nearly $1 million in assistance over the next three years. These funds

will be used to develop new products and services to

expand microentrepreneurs’ access to financial services. The initial focus will be on wholesale lending to

intermediary financial institutions.

With the help of Heifer Project alpacas which produce a higher grade of wool, mothers in the Bolivian highlands give their daughters hope for a better future.

Photo by Matt Bradley, Heifer Project International/Bolivia
10 Reaching Down and Scaling Up: Into the Next Century

K-Rep Bank: Africa’s First Commercial Microfinance Bank

K-Rep Bank is the offspring of the Kenya Rural Enterprise Programme (KRep), an NGO. With USAID funding, K-Rep began making small loans to

street vendors and other microentrepreneurs in Nairobi in 1984. Since

that time, K-Rep has disbursed more than 60,000 loans to 25,000

microentrepreneurs, making it one of Africa’s largest microfinance operations. As it has grown, K-Rep’s non-profit status has constrained its ability

to expand further. As a non-profit institution, K-Rep could not legally raise

capital and was dependent on repayment, credit lines, and grants to fund

new loans. In 1995, K-Rep decided to convert into a fully-regulated commercial bank. To achieve this goal, it worked with the Central Bank of

Kenya to obtain a banking license and secure financial backing from international investors. Four years later, in March 1999, the Central Bank of

Kenya officially licensed K-Rep Bank Ltd. as an autonomous for-profit institution.

SCALING UP MICROFINANCE

Following striking improvements in

the design and implementation of financial services programs for the poor over

the last 20 years, USAID has actively promoted several vehicles to extend these

services to as many microentrepreneurs as

possible. A common theme has been an

emphasis on using sound financial practices in working with the poor. 

USAID has encouraged several institutional developments to help financial

service organizations become stronger

and more independent. In a number of

locations, NGOs have evolved into specialized financial institutions, increasing

their clientele into the tens of thousands.

Some of these NGOs have opted to transform into regulated financial institutions—an institutional framework that

more readily allows them to access commercial sources of funds and mobilize savings. Many other older U.S. PVO’s with

historically broad missions have established specialized microfinance units. 

Commercial banks have also become

more interested in the microenterprise

sector as competitive pressures force them

to seek new market opportunities. This

latter trend, though currently small and

mostly seen in Latin America and in parts

of Asia, seems to have real potential to

greatly increase the volume of lending to

the microenterprise sector in select countries. 

Linking to the Formal Financial Sector

In the early 1980s, the formal financial

sector in most developing countries

showed little interest in microenterprise

clients. In many countries, financial policies provided little incentive for financial

institutions to move in this direction.

Today, financial sector liberalization is

creating many more opportunities for participation by commercial banks and other

regulated financial institutions in the

microenterprise sector. This can be seen

most clearly in Latin America where

microfinance and the liberalization of

financial policies have been largely successful.8

The emergence of banks as active

players in the microfinance sector is having a profound effect on the development

field. Banks already have an advantage

over many NGOs in knowing how to

achieve profitability. In addition, they frequently have an infrastructure in place to

deliver services and, of course, they fully

understand banking operations and regulations. What is new to banks is a commitment to serve microenterprise clients

and develop the products tailored to meet

these client needs. USAID has promoted

forums in Africa and Latin America that

have allowed bankers to discuss the challenge of reaching microenterprise clients

profitably and share strategies for doing

so. 

8See Mayada Baydas, Douglas Graham, and Liza Valenzuela, “Commercial Banks in Microfinance: New Actors in the Microfinance World,” USAID,

Washington, D.C., 1997, and Elisabeth Rhyne, and Robert Peck Christen, “Microfinance Enters the Marketplace,” USAID, Washington, D.C., 1998. 
U.S. Agency for International Development Microenterprise Results Reporting for 1998 11

USAID’s ‘Portable Guarantees’

The Office of Credit and Investment (CIS) in the Economic Growth and

Agricultural Development Center is just one of the USAID/Washington offices

that contributes funds annually to support the growth of microenterprise institutions. Through its ‘portable guarantees,’ CIS has enabled several successful

MFIs in Latin America to expand their portfolios very rapidly. Throughout the

world, banks have required substantial amounts of collateral from microenterprise institutions prior to making loans to these MFIs for on-lending. The CIS

portable guarantee creates a stronger link between the MFI and the formal

financial sector, because a bank can provide much more capital than the MFI

could access through private or donor grants. 

USAID provides a portable guarantee to the MFI, which can then ‘shop’ it with

several banks to get better rates on loan capital. USAID covers 50 percent of

the loss of principal in the event of loan default. 

CIS has offered its portable guarantee to three strong Latin American MFIs:

PRODEM in Bolivia, FIE in Bolivia, and Banco Solidario in Ecuador. The loan

capital obtained with the help of these guarantees was especially important

to PRODEM and FIE which had already exhausted the collateral they had

available for new bank loans. These guarantees represent a significant investment by each institution, which must pay fees for the guarantee in addition to

loan fees for commercial bank funds.

9See “Proceedings: The Commercialization of Microfinance Conference,” Nairobi, Kenya, May 11-14, 1998, USAID, Washington, D.C. This can be

accessed online at www.mip.org under ‘Research and Publications.’

Rural bank member doling out maize porridge to local Ghanaian children.

Photo by Betty LaDuke, Freedom From Hunger/Lower Pra Rural Bank, Ghana

In 1998, USAID held a bankers’ conference in Kenya on the opportunities and

risks associated with microfinance in

Africa.9 One of the institutions featured

was the Nsoatreman Rural Bank (NRB) in

Ghana, established by the government to

stimulate economic development. NRB is

one of 130 rural banks in Ghana. It has

five branches and registered about 15,000

depositors in 1997, 74 percent of whom

were women. In 1996, NRB entered 

into a three-year collaboration with 

Freedom from Hunger – a US-based 

PVO – to extend its program “Credit with

Education” (CWE) to rural women’s

groups. By the end of 1997, CWE active

loans totaled more than $210,000 and

comprised 9 percent of the bank’s loan

portfolio, and 15 percent of its loan

clients. Moreover, CWE broke even 16

months after it was launched, 8 months

earlier than projected.
12 Reaching Down and Scaling Up: Into the Next Century

MICROFINANCE SURVEY FINDINGS

The 1998 MRR survey results include

collated data from 288 actively-supported

microfinance institutions worldwide: 72

from Africa, 102 from Asia and the Near

East (ANE), 27 from Europe and Eurasia

(E&E), and 87 institutions from Latin

America. (See Annex A for details on the

survey methodology.) Of this number, 40

percent received USAID funding in 1998. 

In 1998, USAID-supported institutions increased their savings portfolios by

117 percent.10 A more dramatic increase

occurred in the E&E region, reflecting

USAID’s support to the credit union

movement in Poland. The number of savings members of USAID-supported institutions grew by 139 percent from 1997.

Increased support of savings programs is

especially evident in Africa. 

In 1998, USAID-supported microfiTABLE 4. Savings Clients and Savings Amounts by Region, 1997 and 1998

Region Savings Clients Savings Amounts

(‘000’) (US $ Millions)

1997 1998 Percent 1997 1998 Percent

Change (US $ mil) (US $ mil) Change

(%) (%)

Africa 144.6 904.5 525 20.0 56.0 180

Asia/Near East 1,008.0 2,317.2 130 92.5 83.7 -10

Europe/Eurasia 17.5 357.11 1940 3.5 153.1 4274

Latin America/Caribbean 948.8 1,490.9 57 256.8 515.5 101

Total 2,118.9 5,069.7 139 372.8 808.3 117

1WOCCU/Poland, with funding from USAID’S E&E Bureau, reported over 220,000 savings members with savings amounts of $150 million.

10A decrease in the amount of savings from 1997 to 1998 in the Asia/Near East region is due to reductions in savings held by USAID-supported organizations in Sri Lanka, Philippines and Indonesia. Currency devaluations also reduced the value of portfolio held. An increase in savings clients was reported in

Bangladesh, Cambodia, and India where poorer clients save smaller amounts. 11One large institution in Asia, the Bangladesh Rural Advancement Committee (BRAC) accounts for nearly two million clients. BRAC began as a relief organization in 1972, then expanded into an integrated community development program, and grew to become the largest NGO in Bangladesh by the 1990s. BRAC is more than an

NGO. It also promotes education, health training, income and employment generation, skill development, financial intermediation, and technology development. 

nance institutions increased in both size

and volume of lending activities compared

to 1997. Active portfolio increased by 114

percent and clients increased by over 145

percent.11 The greatest increases in numbers of clients being served occurred in

Africa (64%), Asia and the Near East (over

300%), and in Europe and Eurasia (125%).

USAID-supported institutions with more

than 15,000 clients are rare in both Africa

(5 MFIs) and the E&E (1 MFI) regions, but

are much more common in ANE and LAC

regions (13 MFIs in each region).

Average loan size of USAID-supported programs has decreased from $445

in 1997 to $389 in 1998. Average loan

sizes differ considerably by region. Africa

and Asia and the Near East have the lowest loan sizes at $170 and $249, respectively. The average loan size in Europe

and Eurasia rose from $703 in 1997 to

$1,100 in 1998. Average loan size in Latin
U.S. Agency for International Development Microenterprise Results Reporting for 1998

In all regions, the majority of clients are women

in USAID-supported institutions. USAID has

exceeded its goal of supporting institutions with at

least 50 percent women clients. In 1998, 84 percent

of borrowers from USAID-supported institutions

were women, an increase of 17 percent.

13

TABLE 5. Loan Portfolio of Institutions in 1997

and 1998, USAID’s Active Portfolio

1997 1998 Percent

Loan Loan Change

Amounts Amounts %

(US $ mil) (US $ mil) 

Africa 29.4 46.7 59

Asia/Near East 116.3 614.2 428

Europe/Eurasia 12.3 43.3 252

Latin America/ 487.1 679.0 39

Caribbean

Total 645.1 1,383.2 114

TABLE 6. Clients of Lending Institutions in 1997

and 1998, USAID’s Active Portfolio

1997 1998 Percent

Total Client1 Total Client Change

(‘000’s) (‘000’s) %

Africa 166.8 274.0 64

Asia/Near East 611.1 2,464.0 303

Europe/Eurasia 17.5 39.4 125

Latin America/ 651.9 778.5 19

Caribbean

Total 1,447.3 3,555.9 145

America and the Caribbean rose to $872

from $746 in 1997. In large part, this

reflects an increase in reporting from the

credit unions in both regions with a more

mixed and longer-term clientele. Latin

America is also the home of many mature

microfinance institutions that issue successively larger loans to their repeat

clients.

1MRR uses active loans as a proxy for active clients since it is extremely rare for an individual to have more than one outstanding loan with an institution at a time. Most financial

institutions track only loans and not clients.

TABLE 7. Average Loan Size and Percentage

of Women Clients, 1998 

Average Percentage of

Loan Size Women

(US $) Clients

(%)

Africa 170 73

Asia/Near East 249 93

Europe/Eurasia 1,100 56

Latin America/ 872 62

Caribbean

Total 389 84
14 Reaching Down and Scaling Up: Into the Next Century

TABLE 8. Rural vs. Urban Settings, 1998

Rural Urban

% %

Africa 46.3 53.7

Asia/Near East 76.9 23.1

Europe/Eurasia 18.1 81.9

Latin America/ 41.4 58.6

Caribbean

Total 68.1 31.9

Efforts to extend microfinance services to

rural areas, particularly in Africa, are growing.

Asia has historically had MFIs with extensive

outreach to rural areas. The newer MFIs in

Europe and Eurasia are largely situated in urban

centers.

USAID’s commitment to very poor clients

is seen in the data reported by microfinance

institutions on the number of poverty loans in

their active portfolio. 83 percent of all loans

held at year-end by USAID-supported institutions were poverty loans. (Poverty loans for all

regions other than Europe and Eurasia are $300

or less. For the E&E region, poverty loans are

$1000 or less.) Poverty loans comprised only

67 percent of total loans in 1997.

In assessing loan portfolio quality of

USAID-supported institutions, two primary

indicators are loan repayment and loan loss

rates. Repayment rates are calculated based on

the amount of portfolio reported to be in

arrears for 90 days or more.12 Repayment rates

throughout all regions, except the Latin

American/ Caribbean region, continue to stay

above 95 percent. Loan loss rates, or those loan

amounts which must be written off by the institution, are reported at two percent or below

for all regions except Latin America.

TABLE 9. Poverty Loans, 1998 

Total As 

Micro Poverty Percent

Loans Loans of Total

(‘000’s) (‘000’s) (%)

Africa 274.0 238.2 87

Asia/Near East 2,464.0 2,369.1 96

Europe/Eurasia 39.4 35.1 89

Latin America/ 778.5 305.2 39

Caribbean

Total 3,559 2,947.6 83

12Many institutions calculate arrears based on 30 days past due.

TABLE 10. Average Repayment and Loan Loss

for Microfinance Institutions, 1998

Repayment Rate Loan Loss

% %

Africa 95.6 2.0

Asia/Near East 97.4 0.5

Europe/Eurasia 95.8 1.3

Latin America/ 93.3 2.4

Caribbean

Worldwide 95.3 1.5
U.S. Agency for International Development Microenterprise Results Reporting for 1998 15

USAID requires that the institutions it

supports have a credible plan for achieving self-sufficiency. Table 11 indicates the

proportion of USAID-supported institutions that reported having achieved operational or full financial sustainability.13

Where 13 percent of the Latin American

institutions had reported that they could

cover the cost of their operations through

revenues (operational sustainability) in

1997, this percentage increased to 30 percent in 1998. Another 31 percent met the

higher standard of being able to cover the

cost of obtaining funds (full financial sustainability) in 1998. Because many of the

Latin American institutions included in

USAID’s portfolio are older, more mature

institutions they have made greater

progress toward achieving sustainability. 

Where the percentage of institutions

from all regions that have achieved operational sustainability rose from 9 percent in

1997 to 13 percent in 1998, the percent

reporting financial sustainability declined

from 26 percent to 15 percent. However,

the proportion of clients served by sustainable institutions is higher than that

served by those which are not yet sustainable. The larger institutions have made

more progress on this front than the many

newer institutions USAID supports. 

13Because USAID’s portfolio changes from year to year, depending on which institutions ae funded under mission objectives, it is not possible to trace 

over time an identical set of institutions on their path to institutional sustainability.

TABLE 11. Financial Sustainability of USAID-Supported

Microfinance Institutions, 1998

Not

yet Operationally Fully 

Sustainable Sustainable Sustainable

(%) (%) (%)

Africa 83 11 6

Asia/Near East 89 1 10

Europe/Eurasia 82 7 11

Latin America/

Caribbean 39 30 31

Worldwide 72 13 15

1Data is self-reported by institutions.

Photo by Jon Warren, World Refief/Cambodia
16 Reaching Down and Scaling Up: Into the Next Century

Business Development Services

(BDS)

While donors and practitioners have

devoted the majority of their resources in

the past two decades to refining microfinance methodologies, a number of practitioners have focused on enhancing the

productivity of microenterprises through

the provision of non-financial services.

More recently, donors such as USAID

have shown much more interest in

improving the methodologies to implement BDS to achieve greater impact and

scale within existing programs. Moreover,

donors have recognized that the poor

often need services other than credit to

create sustainable enterprises that will

help pull them out of poverty.

Business development services include

a variety of programs that address constraints experienced by entrepreneurs

such as poor product design, lack of inputs

or market outlets, and insufficient technical or management skills.

This year’s survey of microenterprise

institutions was expanded to include those

providing business development services

to either microentrepreneurs or microenterprise assistance organizations. There

were 82 institutions with USAID funds

for this purpose that returned the survey.

Of these 24 are located in Africa, 12 in

Asia and the Near East, 30 in Europe and

Eurasia and 15 in the Latin American/

Caribbean region. One organization

reported on its worldwide operations. 

Faulu Kenya: Trinity Clinic 

Florence Kariuki, a Faulu (Food for the Hungry) Kenya

client, is the owner of the Trinity Clinic in the Ngando slums

in the southern part of Nairobi. Her clinic is in a small

house that Florence has enlarged to accommodate some of

the facilities that are required for a clinic, e.g., ward,

kitchen, emergency case area, etc. In this small clinic,

Florence delivers babies, gives immunizations, and attends

to family planning cases. Florence delivers an average of

13 babies a week, but the recovery room can fit only three

beds, and there are times when Florence is forced to have

patients rest on a bench due to the lack of space. 

Florence learned about Faulu in 1996 from a friend. She

immediately decided to join the program. With her first

loan of $480, she bought drugs needed for the clinic. After

this, her practice grew quickly. She has since received several additional loans from Faulu. Florence is now servicing

a loan of $3,000 and increased her employees from three

to ten. Due to the high demand for medical treatment, her

clinic now operates 24 hours a day. 

Florence Kariuki in her clinic.

Courtesy Food for the Hungry, Inc./Faulu Kenya
U.S. Agency for International Development Microenterprise Results Reporting for 1998 17

14By type of organization, those organizations with USAID funding to provide business services that responded to the survey included PVOs (34), NGOs

(31), research institutions (5), for-profits (4), business associations (3), cooperatives (2), international consulting firms (1), government agencies (1), and USAID

projects (1).

Type of Service Institutions 

Providing BDS

(%)

Business management training 89

Entrepreneurship training 85

On-site technical assistance 85

Marketing linkages between buyer and seller 77

Mentoring 74

Access to inputs, equipment, processes, and skills 72

Market research and information 67

New product development and testing 65

Subsector research and information 61

Assistance with buying and selling products 60

Quality control of products 60

Trade fairs 55

Training in other areas, e.g. leadership 48

Subsector interventions 48

Other forms of business counseling and technical assistance 39

Information on taxing and regulations 37

Assistance with business licensing 35

Other kinds of marketing assistance 35

TABLE 12. Business Services Provided by USAID-Supported Institutions

Of the institutions reporting, 94 percent

were engaged in providing direct business

services to microentrepreneurs (see Table

12 for a list of services provided). Of this

number, 52 percent provided services to

both entrepreneurs and organizations and

another 6 percent provided services to

organizations only. One-third received

1998 funds and the remainder have active

USAID funding agreements from prior

years. 

BDS PROVIDERS 

BDS providers were primarily PVOs

(41%) and NGOs (38%). In addition,

USAID funded business associations,

cooperatives, for-profit organizations, and

several research institutions, all of which

have expertise in promoting business

development.14 The average age of all

organizations providing business services

was 6 years; 33 percent were under 3 years

and 12 percent over 10 years.
18 Reaching Down and Scaling Up: Into the Next Century

In addition to the services listed in

Table 12, other services organizations

provide on a regular basis include

investor-partner matching, association

development, NGO development and

advocacy, information and experience

exchange, documenting lessons learned,

and environmental conservation. 

The majority of the USAID-supported

BDS programs (51%) work in tandem

with financial services. In fact, 39 percent

of the institutions also provide financial

services, while others work closely with

financial institutions to ensure that their

clients have access to working capital and

other financial services. 

BDS CLIENTELE

There were 2.2 million individuals and

23,148 organizations that received BDS in

1998 from USAID-supported institutions.

The majority of clients in all regions were

women. 

Many business development activities

are designed for rural microentrepreneurs

who are engaged in multiple income-generating activities. In 1998, the majority of

the businesses (62%) reached by USAIDsupported institutions were agro-related

enterprises. Other sectors represented

were commerce (10%), manufacturing

(9%), service (9%), and other (10%). 

Most BDS clients (79%) had been in

business prior to receiving services, while

21 percent of the clients were undertaking

new business activities.

Jordan River Foundation, Jordan 

The Jordan River Foundation (JRF), founded under the patronage

of Her Majesty Queen Rania Al-Abdullah, has three primary

enterprise projects: Jordan River Designs, Bami Hamida

Women’s Weaving, and Wadi Rayyan Wicker Furniture.

Through the Wadi Rayyan Wicker Furniture Project, women are

instructed in the craft of basket and mat weaving and hand spinning straw ropes. Bamboo and banana leaves that would otherwise be discarded are used to produce the diversified product line of quality wicker furniture for both local and international markets.

JRF invests in product development, maintains staff marketing

expertise, and has a network of distributors throughout Jordan.

JRF’s delivery of business support services has resulted in

increased sales revenues, which are used to cover production

costs. Revenues from sales pay 70 to 80 percent of project

costs. JRF has also been successful in scaling up its operations,

reaching over 3,500 women, while keeping its outreach

focused on poor rural women. 

A new partnership in Jordan brought together JRF, Cooperative

Housing Foundation, USAID, and the private banking sector to

provide microfinance services to people living in the impoverished southern part of Jordan. JRF will provide business training

to current and future microfinance clients.

“The experiences of Jordanian women have shown how it is

possible to see businesses thrive among the most traditional

of societies.” Her Majesty Queen Rania Al-Abdullah 

Courtesy USAID/Jordan
U.S. Agency for International Development Microenterprise Results Reporting for 1998 19

TABLE 13. Clients of USAID-Supported BDS 

Programs

Entrepreneurs Women Rural Clients

Served (%) (%)

Africa 34,876 57 40

Asia/Near East 2,175,552 93 82

Europe/Eurasia 6,662 59 23

Latin America/

Caribbean 811 56 40

All regions2 10,000 80 80

Worldwide 2,227,901 92 81

1When BRAC is excluded, the overall percentage of women clients decreases to 76 percent. 

2One organization reported on its activities that included work in several regions.

15If one excludes BRAC, 78 percent of all program clients are in the bottom fifth income bracket for their country.

The Microenterprise and Small Producer

Support Project (MSP) in Peru

In Peru, there are an estimated 300,000 microenterprises engaged in handicraft production; in addition,

90 percent of all apparel and shoe production enterprises are microenterprises. MSP is currently engaged

in four product sectors: handicrafts, wearing apparel,

shoes, and products from the Peruvian Sierra, where

low-income microentrepreneurs reside in large numbers. 

MSP has reoriented Peruvian artisan production away

from the traditional low-end U.S markets (such as flea

markets and small tourist shops) to the rapidly growing, high-end multi-billion dollar home furnishings market. Since the beginning of MSP activities in 1994,

client sales have increased by $23.7 million and

6,600 full-time jobs have been created within the

assisted firms.

REACHING THE POOR

The BDS providers reported that 97

percent of their clients are in the lowest

income quintile for their country.15 This

suggests that USAID-supported BDS programs, like many microfinance programs,

are reaching those in greatest need for

improved opportunities for income generation.

While poverty loans ($300 and less)

are used as an indicator of a microfinance

institution’s service to the poor, there is

not a single proxy for the poverty status of

business development clients. However,

40 of the business service organizations

reported 88 different programs supported

by USAID in 1998 that are specifically

designed to meet the needs of the poor.

The programs include services such as

counseling and dissemination of market

information in rural areas, contract brokering in the garment industry, and business management training.

PROMUC vendor in Peru.

Courtesy PROMUC/ Peru
20 Reaching Down and Scaling Up: Into the Next Century

On the Way to Cost Recovery in Guinea

PRIDE/Formation, begun by Volunteers in Technical Assistance (VITA),

has developed an innovative and practical training program for

microenterprises and small businesses in Guinea, one of the world’s

poorest countries. It has tailored its services to microentrepreneurs’ needs

by providing short-term evening courses in several local languages

geared toward its semi-literate clients. PRIDE/Formation’s success lies in

its ability to modify and increase its training products to meet the changing needs of its clients.

PRIDE/Formation has also developed an affordable, cost-effective, twotiered pricing structure for its training program. Individual entrepreneurs

pay a lower price than institutions. This fee structure has made training

affordable to a large number of microentrepreneurs, including many

women. As a result of this approach, PRIDE has seen its level of cost

recovery rise from 25 percent in 1996 to 73 percent in 1998.

BUILDING SUSTAINABLE BDS PROGRAMS 

In business the best measure of

demand for any service, including finance,

continues to be an entrepreneur’s willingness to pay for the service. Of the organizations responding to the survey, 46 percent charge fees for their services. USAID

continues to strongly encourage this practice and the goal of increasing cost recovery to ensure that all enterprise support

services are based on market demand and

valued by clients. 

There is still much debate as to the

extent to which institutions providing

business services should be able to cover

the full costs of providing these services.

Unlike microfinance institutions that

often quickly reach a volume of loan activity that supports the cost of providing

financial services, BDS providers typically

evolve more slowly toward cost recovery.16 But some organizations are quickly

demonstrating that BDS programs can

recover costs when they are well managed

and market-driven. PRIDE/Formation in

Guinea is an example. (See box)

A PRIDE/Formation training class for micro-entrepreneurs.

Courtesy VITA/PRIDE Formation, Guinea

16See Clifton Barton. “Microenterprise Business Development Services: Defining Institutional Options and Indicators of Performance,” Microenterprise Best

Practices Paper, Bethesda, MD.
U.S. Agency for International Development Microenterprise Results Reporting for 1998 21

The Policy Context

USAID has long seen the insufficiency

of promoting microenterprise development services alone within countries that

have difficult legal and regulatory environments for microenterprises. Policy

biases within the areas of agricultural policy, foreign trade, capital and labor markets, taxes, and business regulation and

licensing have been identified as key areas

affecting microentrepreneurs.17 This year

for the first time the survey of USAID’s

development partners included those

engaged in advocacy or research to

improve microenterprise policies. 

Of the total US dollars for microfinance, 1.9 percent ($1.8 million) was

spent to improve the policy environment

for microfinance institutions. Of the total

US dollars spent for non-finance, 10.3

percent ($4.6 million) was spent on

microenterprise policy research and advocacy. While these amounts are small, the

dividends from efforts in this area cannot

be overstated. Often changes in the policy

and the regulatory environment can have

a profound effect on microentrepreneurs.

Laws and enforcement practices limiting

the ability of street vendors to sell their

wares without a license, for example, have

significant implications for poor entrepreneurs who may have no other means to

earn additional income. Policies affecting

the regulation of NGOs that work closely

with the microenterprise sector have

strong implications for assistance to the

poor. USAID-sponsored programs work

to improve the policy environment for

microentrepreneurs and the organizations

that help them.

17Beginning in the 1980’s USAID’s Employment and Enterprise Policy Analysis (EEPA) Project identified a range of policies affecting small and microenterprises. See Robert C. Young, “Enterprise Scale, Economic Policy and Development: Evidence on Policy Biases, Firm Size, Efficiency, and Growth,” Occasional

Paper Number 52, International Center for Economic Growth, 1994. 18USAID has supported policy advocacy and research in Latin America, however, none of the institutions providing this service responded to this year’s survey. In Bolivia, for example, USAID has provided support to the Superintendency of Banks in its efforts to create appropriate supervisory procedures.for microfinance institutions. 19This is being funded in Cambodia, Indonesia, Jordan, Nepal, Philippines, Tanzania, and Uzbekistan.

International Center for Economic Growth

In Kenya, USAID sponsored efforts by the International Center for

Economic Growth to improve the working conditions for microentrepreneurs. These efforts focused on enhancing the security of tenure and

improving access to workspace, road transport, electricity, water, and sanitation facilities to support microenterprise growth. 

Policy Advocacy in Central Asia

In the Central Asian Republics, Aid to Artisans has advocated on behalf of

NGOs involved in the production of handicrafts to achieve fairer export

regulations and ensure free competition with state-run organizations.

In the FY 1998 survey, 15 USAID-supported organizations provided details of

their policy activities. Of these, six were

from the NIS, five from Asia, three from

Africa, and one from the Near East.18

The majority of these institutions (60%)

are working on policies that affect microfinance institutions. All institutions in

Asia and the Near East are involved in

some aspect of microfinance policy,

although two are working in non-financial

areas as well. USAID is supporting the

effort in seven countries to develop appropriate guidelines for the regulation and

supervision of NGOs and other MFIs, as

they take on more of the functions of formal financial institutions.19

All institutions surveyed from the NIS

and one institution in Africa are effecting

change in areas other than microfinance.

In the NIS, in particular, emphasis has

been placed on promoting independent

business associations to advocate for and

serve microenterprises. USAID has also

provided support for streamlining business

regulation and licensing (Kenya, Jordan,

and Ukraine) and improving the business

tax code in Uzbekistan.
22 Reaching Down and Scaling Up: Into the Next Century

WOCCU/Philippines: Crispina Canales

Crispina Canales started out in business with a small food stall in a rural

community, located in southern Mindanao. The little restaurant served ten

people at a time and featured five dishes, including her specialty -

roasted pig. 

Crispina learned that a local credit union, Nabunturan Integrated

Cooperative (NICO), was offering loans to local businesses. She

deposited $7.50 in share capital and attended the required pre-membership seminar. Almost immediately she was eligible for a loan of

$37.50. With the loan, she purchased better equipment and hogs.

Instead of depending on a farmer to supply her stock, she could raise her

own. She quickly repaid the loan and was granted a second loan of

$125.

Three years later the eatery sales had increased by 50 percent. Crispina

had saved so much that she was able to purchase over two acres of rice

farmland for $175. In 1999, Crispina took out a loan to expand the

eatery, doubling its size. She now offers 30 different dishes daily and can

feed 50 people at a time. 

Today, Crispina uses all the services of her credit union. She has regular

passbook savings accounts, share capital and available credit. She also

uses personal and microfinance loans. After seven years in the credit

union, her most recent loan was for $2,375. 

In 1998, NICO had 10,600 members. NICO is currently a part of a

USAID-supported program run by the World Council of Credit Unions,

Inc. (WOCCU) and Freedom From Hunger called CUES (Credit Union

Empowerment and Strengthening) Philippines. 

Into the Next Century

While USAID has made great strides

in tailoring its programs to the specific

needs of microenterprises, a number of

important challenges remain. Lessons

emerging from on-going experience in

microenterprise development bring new

challenges every day to make services

more sustainable, more relevant, and more

accessible to the very poor. 

The first of these challenges is to continue to expand the range of microcredit

products and other financial services. An

impressive number of microfinance institutions in every region of the world are

balancing the goals of poverty outreach

and profitability. In some countries, commercial institutions are beginning to show

an interest in this market. Yet evidence is

emerging that there is great potential to

expand the range of credit products available, so as to better meet client needs 

and reach down to poorer segments of 

the economically-active population.

Emergency loans are one example of this.

Insurance and safe savings vehicles are

other important financial services that

serve the needs of the poor.

The second challenge is to go beyond

microcredit and microfinance. Rarely is

access to a microloan of hundreds or even

thousands of dollars sufficient to help a

poor entrepreneur escape poverty by

building a successful business. A critical

lesson emerging from the field is that

access to business services, such as market

linkages and improved technologies, plays

Crispina Canales and her husband in their newly expanded restaurant.

Courtsey WOCCU/CUES/Philippines
U.S. Agency for International Development Microenterprise Results Reporting for 1998 23

an important role in efforts by the poor to

boost their incomes, assets, and economic

security. 

A third challenge is to move beyond

the cities. In the case of both microfinance and BDS, rural entrepreneurs are at

a particular disadvantage in their ability to

gain access to these services. USAID is

encouraged by the experimentation its

partners are undertaking to identify costeffective means of outreach. These efforts

are beginning to pay off as seen by the

increase in loans to the rural population in

Africa, for example. 

A fourth challenge is to continue to

cope with crises affecting the microenterprise sector. Increasingly the Agency and

its partners are being called on to support

microenterprise development as a

response to crisis. This report has highlighted some of USAID’s and its partners’

recent responses to events in Latin

America, Asia, and Europe.

Finally, a fifth challenge is to try to

level the playing field for microenterprises. Experience has suggested how very

important the policy and regulatory environment is to the ability of very poor

entrepreneurs to launch and grow their

enterprises. Poorly-defined access to

space in urban markets exposes vendors to

harassment by police and other vendors.

Inheritance and property laws prevent

women from obtaining title to business

property and borrowing against that property. Unfair allocation of import licenses

inhibits micro-scale firms from gaining

access to the inputs on which their livelihoods depend. USAID will continue to

support the tough work of creating a more

enabling policy environment for poor

microentrepreneurs and the institutions

that serve them.

Courtesy PEOPLink/Guatemala
24

ANNEX A

Microenterprise Results Reporting20

Funding Data

Microenterprise Results Reporting (MRR) is the primary system for collecting microenterprise data used within the Agency for planning and budgeting purposes. The funding data presented in this report is collected from

USAID mission officers and microenterprise staff. 

In the past year, MRR established an interactive database accessed via the

internet by USAID missions which enter their funding data online. This system has greatly expedited the flow of information used to report on USAIDfunded microenterprise activities. The public website contains previous years’

reports and can be accessed at www.mrreporting.org. 

Institutional Data

For FY 1998, MRR expanded the survey of microenterprise assistance

institutions to include those receiving funding for BDS activities and policy

advocacy and research. 

The survey of microenterprise assistance institutions includes all institutions supported through active funding agreements with USAID, including

umbrella organizations. In many countries, an umbrella institution is used to

channel either funds or technical assistance to smaller implementing organizations. Working through umbrella agreements allows USAID to extend its

outreach to many more organizations, hence underserved clients and regions.

To better describe the results of USAID’s funding efforts, MRR has attempted

to obtain data from each of the implementing organizations assisted through

an umbrella agreement. 

In 1998, 288 microfinance institutions reported data on their financial service activities. Of this number, 114 received funding in 1998. The remainder

had on-going funding agreements from prior years. Of the total number of

microfinance institutions receiving funding for financial activities in 1998, 61

percent provided data for 1998.21 Many organizations with no data to report

had recently received USAID funds to initiate new activities. The results of

these activities will be presented in the FY 1999 report. 

As in previous years, each institution was asked to report on the volume of

20Microenterprise Results Reporting (MRR) is managed by Weidemann Associates, Inc., a US-based consulting firm, under a USAID-funded contract,

MicroServe. 21Thirteen USAID projects were funded in 1998 for financial activities and had not yet subobligated funds to specific institutions at the time of data collection.
U.S. Agency for International Development Microenterprise Results Reporting for 1998 25

TABLE 14. Microenterprise Institutions Funded by USAID in 1998

Total Obligations Financial Obligations Non-Financial 

Obligations

Amount Number Amount Number Amount Number

(US $000’s) (US $000’s) (US $000’s)

Banks 3,137 9 3,107 8 30 1

Business Associations 3,163 10 272 8 2,891 3

Consulting Firms 7,180 11 2,388 5 4,792 7

Coops/Credit Unions 4,261 29 4,061 28 200 1

For-Profit Organizations 2,578 5 1,907 2 671 3

Gov. Agencies 1,400 2 400 1 1,00 1

NGOs 25,541 75 20,229 55 5,312 21

Non-Bank Financial 

Institutions 20,027 7 20,027 7 - 0

PVOs 46,608 101 27,513 64 19,095 44

USAID1 14,934 20 9,709 13 5,225 9

Research Institutions 4,388 9 1,000 2 3,388 7

Other2 5,228 14 3,429 7 1,799 7

Total3 138,445 292 94,042 200 44,403 104

1Mission projects that have not yet committed funds to particular institutions, mission support activities on behalf of microenterprises, and the technical assistance

and support activities of the Office of Microenterprise Development.

2Includes institutions that do not fit into other categories, such as the International Labor Organization (ILO).

3Note that the total of all institutions does not equal the number for financial and non-financial institutions, as 12 institutions received funds for both types of activities.

its lending activities and the percentage of

its portfolio in poverty loans. Microfinance institutions in Africa, Asia and the

Near East, and Latin America/Caribbean

were asked to report on poverty loans

with an initial loan size of $300 or less. In

Europe and Eurasia, financial institutions

report on poverty loans of $1000 and less.

For the first time, all 288 microfinance

institutions providing data were able to

report on their poverty lending activities.22 In previous years, not all USAIDsupported institutions had the capacity to

report this data. 

Of the implementing organizations

providing BDS, 82 responded to the MRR

survey. Of this number, 27, or one-third,

received funding in 1998. There were 95

different institutions that received funds

in 1998 for non-financial activities,

including policy advocacy and business

development services.23 Many had first

time USAID funding and no 1998 data to

report. Fifteen institutions working in the

area of policy advocacy and research

reported data in this year’s survey.

22Three of the total microfinance institutions had only savings data to report, hence poverty lending was not applicable.

23Nine USAID projects were funded in 1998 for non-financial activities.
26 Reaching Down and Scaling Up: Into the Next Century

TABLE 15. USAID’s Active Microenterprise Institutions 1998 Survey Respondents

Types Total Active Microfinance Survey Business Development Survey Policy Survey

Number Number Number Number

Banks 24 20 - 1

Business Associations 13 8 3 -

Consulting Firms 13 - 1 3

Coops/Credit Unions 76 45 2 -

For-Profit Organizations 12 3 4 1

Gov. Agencies 5 - 1 -

NGOs 313 163 31 2

Non-Bank Financial 

Institutions 11 7 - -

PVOs 163 42 34 7

Research Institutions 10 - 5 -

USAID1 29 - 1 -

Other2 14 - -1

Total 683 288 82 15

1Mission projects that have not yet committed funds to particular institutions, Mission support activities on behalf of microenterprises, and the technical assistance

and support activities of the Office of Microenterprise Development.

2Includes institutions that do not fit into other categories, including UN organizations such as the International Labor Organization.
27

ANNEX B

Microenterprise Funding Sources

USAID funds microenterprise activities through four separate accounts

and PL 480 monetized funds. The following appropriated accounts are currently active: 

■ Development Assistance (DA) is used for long-term development objectives

worldwide; 

■ Economic Support Funds (ESF) are determined by the U.S. State Department

for each country based on particular economic, political or military

objectives;

■ Special Assistance Initiatives (SAI) are appropriated by the U.S. Congress for

specific foreign policy purposes; and,

■ The Freedom Support Act (FSA) is an account established in 1992 to fund

development activities in the New Independent States.

1Development Assistance (DA) Funds include the Development Fund for Africa (DFA).

2Total does not add up because data on fund accounts not available for Colombia and Oman. 

TABLE 16. Sources of USAID Funds for Microenterprise by Appropriation Account, 1990 - 1998 

(US $ millions)

Fund 1990 1991 1992 1993 1994 1995 1996 1997 1998

DA1 44.6 40.2 61.3 51.6 89.2 93.3 72.9 83.3 79.9

ESF 9.6 43.2 34.4 20.8 31.6 22.9 16.1 24.5 27.2

FSA 5.4 20.6 14.3

SAI 4.7 24.8 4.6

Local 21.0 30.2 30.6 23.6 16.6 17.3 12.2 11.8 12.4 Currency

Total 75.42 113.6 126.3 96.0 137.4 133.5 111.4 165.0 138.4
28

ANNEX C

Centrally-Funded Microenterprise Programs

To implement the Microenterprise Initiative, in 1994 USAID established

its Office of Microenterprise Development, located in the Center for

Economic Growth and Agricultural Development in the Global Bureau

(G/EGAD/MD). The primary activity of this office is the Microenterprise

Innovation Project (MIP) that serves as an umbrella for five interrelated programs and several special activities. Together, these programs work to advance

knowledge, support best practices, and build local capacity to offer high quality, sustainable microfinance and business development services. 24

■ The Implementation Grant Program (IGP) provides grants to US and

international organizations for financial and business development services. The IGP is a competitively-run grant program that has provided

funds to experienced implementing institutions. Its purpose is to promote

innovations and expand microenterprise service provision by increasing

the outreach and financial sustainability of financial service organizations

and by improving the cost-effectiveness of BDS providers. All IGP agreements are performance-based and include annual implementation targets

such as percent of women clients, number of loans outstanding, return on

operations, and delinquency rates. The Office of Microenterprise

Development performs periodic assessments to ensure that institutions

have the capacity and resources needed to meet their development objectives. In 1998, USAID funded IGP grants totaling $14 million. 

■ The Program for Innovation in Microenterprise (the PRIME Fund) cofinances microenterprise projects designed and managed by USAID missions overseas. The program’s purpose is to improve the range, scope, and

quality of USAID mission microenterprise initiatives. The fund focuses

on local microfinance institutions and BDS practitioners and looks for

improved service quality, outreach and financial sustainability. In

1998,USAID-funded PRIME projects totaled $7 million. 

■ The Assessing the Impacts of Microenterprise Services (AIMS) Project

goal is to gain a better understanding of the processes by which microen24Further information on USAID’s Microenterprise Innovation Program is available through its website at www.mip.org.
U.S. Agency for International Development Microenterprise Results Reporting for 1998 29

terprise services support clients and

their households as they take advantage of opportunities and improve

their economic and social wellbeing. Activities under the project

include:

• Producing rigorous impact assessments through longitudinal fieldsurveys in three different regions; 

• Developing and testing impact

assessment tools for use by international PVOs and local NGOs; 

• Providing technical assistance and

training services to USAID missions and their partners in client

and impact assessment; and, 

• Establishing a system of information exchange among experts 

and practitioners on current practice in impact assessment.

■ The impact assessment tools consist

of a mix of quantitative and qualitative instruments to be used by microfinance practitioners to understand

client behavior and satisfaction and

to assess the impact of their programs. Intended to be low cost, the

tools permit institutions to generate

credible and useful results within a

limited time frame. Further information on the tools and AIMS publication are available at www.mip.org. 

■ The Microenterprise Best Practices

MBP Project expands the knowledge

base of microenterprise practices

through action research and publications, a grant facility, and information sharing. Best practices in the

field of microenterprise development

are documented and disseminated

through case studies, review papers,

seminars, and the MIP website. MBP

is implemented through a group of

organizations led by Development

Alternatives, Inc.

■ MicroServe contracts provide training and technical assistance to

USAID missions and practitioners

worldwide. The two main contractors, Chemonics International, Inc.

and Weidemann Associates, Inc.,

provide this support. 

The Office of Private and 

Voluntary Cooperation

The Matching Grants Program in the

Bureau of Humanitarian Response/Office

of Private and Voluntary Cooperation

(BHR/PVC) has a long and successful history in assisting US-based PVOs and their

local partners in all sectors strengthen

their ability to achieve sustainable service

delivery. PVC’s support to the PVO community focuses on developing sustainable

institutional capacity among its partners. 

The Matching Grants Program has

played an instrumental role in assisting

PVOs in the development of their

microenterprise programs. Matching

Grants Program funds, for example, are

supporting Plan International’s efforts to

develop a sustainable high-performance

microenterprise program. The evolution

of Plan International’s microenterprise

program has required the development of

new methodological tools, technically

proficient staff, and a significant change in

the way this PVO implements, manages,

and evaluates development projects. The

Matching Grant Program is enabling Plan

International to develop new systems,

build staff capacity, and monitor and evaluate progress. Significantly, the implementation of microenterprise best practices has begun the transformation of this

PVO’s programming in other sectors from

that of a charitable social welfare

approach to one that increasingly emphasizes sustainable service delivery, technical performance, and strong partnerships

with local NGOs. 
30 Reaching Down and Scaling Up: Into the Next Century

Looking to the Future: Development Credit Authority

A new financing mechanism, the Development Credit Authority

(DCA), is now available to support microenterprise development

worldwide. DCA is a general authority that permits USAID to offer

credit assistance (direct loans or loan guarantees) for any development purpose of the Foreign Assistance Act. 

DCA is similar to existing programs administered by the Credit and

Investment Staff (G/EGAD/CI) and the Office of Environment and

Urban Programs (G/ENV/UP), however, DCA projects to benefit

microenterprise will be initiated and managed by local missions,

regional bureaus or the Office of Microenterprise Development. In

the future, the Office of Microenterprise Development may initiate

its own loan portfolio guarantees, bond guarantees or direct loans

as another mechanism for assisting NGOs to graduate beyond

donor subsidies and achieve greater independence and sustainability. Business service providers with strong operational histories

may also be candidates for credit support through this vehicle. The

Agency’s DCA Team, located in the Credit and Investment Staff, is

available to assist interested operating units (missions, regional

bureaus, etc.) in identifying and evaluating valid credit opportunities.

In addition to supporting capacity- building initiatives with individual PVOs, the

Matching Grants Program has been

closely involved in developing PVO partnerships and networks. The Small

Enterprise Education and Promotion

Network (SEEP) serves as a center for best

practice learning and information dissemination to the microenterprise community.

SEEP excels in three areas: 

• Facilitating collaborative research 

and lateral learning among diverse

practitioners; 

• Developing practitioner-oriented 

materials, including computer 

tools, training manuals, and working papers; and, 

• Designing and, delivering training 

emphasizing hands-on and participatory methods. 

The SEEP Network has produced

materials on evaluation, credit program

design, financial projections, poverty

lending, and institutional development.

SEEP currently has a Matching Grant

designed to build the capacity of its 50

North America-based member PVOs and

extend its proven capacity building services in developing countries through new

partnerships with field-based microenterprise networks.
REGION COUNTRY 1991 1991 1993 1994 1995 1996 1997 1998 

Africa (AFR) 

Benin 1,835 1,040 

Botswana 451 627 158 

Burkina Faso 110 150 

BUl'Wldi 1,020 2,171 543 

Chad 270 258 1,635 10 

Eritrea 200 200 Ethiopia 330 34 1,049 

Gambia 37 100 298 10 276 

Ghana 250 1,050 505 2,584 4,515 4,448 

Guinea 4,054 1,409 2,210 2,210 500 401 73 

Guinea-Bissau 40 1,370 1,855 2,575 2,033 

Kenya 1,608 1,084 270 1,650 2,000 2,904 1,717 

Madagascar 685 801 550 229 260 

Malawi 5,482 3,466 1,953 

Mali 3,346 4,329 175 8,251 1,160 148 417 809 Mozambique 450 750 180 630 3,373 2,370 2,802 

Namibia 280 320 410 712 241 

Niger 2,795 3 715 

RCSA 400 REDSOIEA 260 

Senegal 932 7,040 7,850 3,520 450 932 364 2,500 South Africa 3,021 8,016 3,781 3,308 4,005 Swaziland 1,879 3,327 

Tanzania 1,558 1,478 200 

Togo 1,292 1,141 

Uganda 2,328 2,330 3,358 2,582 2,416 3,044 5,48 1 5,162 

Zambia 570 153 500 600 1,000 616 

ZImbabwe 720 603 5,500 425 350 35 

Regional Programs 491 100 800 

AFR Subtotal 11,470 35,195 19,747 14,07" 17,013 21,853 25,764 24,411 

AsialNear East (ANE) 

Bangladesh 1,500 250 650 1,165 5,670 8,639 7,663 

Cambodia 112 462 2,398 

Egypt 24,892 35,554 11,000 17,376 16,020 10,000 15,000 15,000 

india 428 

Indonesia 1,867 2,590 679 2,200 747 866 

Jordan 1,031 100 500 2,792 3,539 

Lebanon 2,045 1,000 1,000 

Morocco 210 1,500 3,600 1,450 990 

Nepal 840 1,980 2,260 1,950 1,200 50 1,170 1,855 

Pakistan 3,417 3,134 Philippines 23,866 4,820 2,666 4,802 8,411 3,000 2,746 

South Pacific 2,336 564 

Sri Lanka 1,353 2,873 1,292 482 549 769 200 

Yemen 821 658 West Bank/Gsza 1,888 2,499 3,311 

ANE Subtotal 59,391 53,673 18,811 11,699 31,879 30,888 36,915 36,970 

Europe and the NIS (ENI) 

Albania 2,240 2,200 225 1,000 1,000 

Armenia 553 2,150 Azerbaijan 99 1 4,200 

Bulgaria 1,564 1,400 771 132 524 
32 Reaching Down and Scaling Up: Into the Next Century 

ANNEX D 

Summary of USAID Microenterprise Funding by Country, 1990-1998 

US$ 'OOO's 

REGION COUNTRY 1991 1992 1993 1994 1995 1996 1997 

Caucasus 6,940 

Central/Eastern Europe 2,614 Croatia 500 

Czech Republic 569 500 

Estonia 224 150 

Georgia 870 923 2,027 

Hungary 1,197 730 

Kazakstan 244 Kyrgystan 6,200 487 2,878 Latvia 224 430 Lithuania 560 600 

Macedonia 2,500 950 900 Moldova Poland 7,756 4,976 1,693 19,088 Romania 896 500 1,405 3,200 

Russia 12,810 5,200 2,475 2,139 

Slovakia 896 500 

Ukraine 2,100 450 

ENI Subtotal 0 0 2,614 38,106 20,136 10,473 45,398 

Latin America and the Caribbean (LAC) 

Belize 342 266 

Bolivia 1,442 2,136 3,548 5,532 7,652 1,775 1,800 

Ca.'ibbean Regional 1,021 1,005 1,000 4,610 600 

Costa Rica 200 300 110 140 IS 

Dominican Republic 4,778 5,684 2,065 1,300 780 

Ecuador 200 250 945 1,094 796 EISalvador 11,863 11 ,882 9,898 19,120 7,788 2,478 3,214 

Guatemala 795 647 708 1,974 Guyana 875 350 700 53 

Haiti 2,030 1,180 760 3,148 2,868 Honduras 9,783 8,307 6,190 1,187 587 914 

Jamaica 356 745 946 743 696 442 389 

Mexico 65 200 

Nicaragua 627 101 1,744 448 1,222 

Peru 387 732 4,592 3,011 7,796 3,220 4,447 

Regional Programs 1,444 

LAC Subtotal 25,394 25,438 35.589 40.721 32.595 15,200 20.101 

CENTRAL BUREAUS 

1998 

2,000 

200 

310 

1,377 

1,177 

500 

60 

2,050 

7,340 

2,403 

18,941 

3,230 

945 

3,800 

1,403 

3,698 

1,440 

6,564 

21.080