> Posted by Jon Pattee
Bullish on the future of microfinance? The Economist Intelligence Unit seems to be like-minded.
Microfinance is quickly shifting from a niche product to a globally recognized form of finance, according to the unit’s researchers, who recently released the report “Global Microscope on the Microfinance Business Environment 2010.”
In this process of transformation, hi-tech is allowing the industry to lend and offer financial services to low-income populations and entrepreneurs around the globe, say the report’s authors.
The industry still faces some rough patches, however. While both providers and investors increasingly consider microfinance commercially viable in developing countries, regulatory and market gaps keep microfinance from operating as well as it should.
The report offers an in-depth analysis of the microfinance business environment in 54 countries for a second consecutive year. It is also the fourth yearly index to track conditions in the 21 countries of the Latin American and Caribbean region.
Latin America and the Caribbean has the largest range of scores among the six regions: half of the 10 top-ranked countries were from the region as well as four of the 10 lowest-ranked countries.
Peru, the Philippines, and Bolivia ranked highest for a second consecutive year. Peru held fast to its position as the global leader, scoring 74.3 out of 100, much as it did last year.
The remaining top 10 nations are located in Latin America (Ecuador, El Salvador, and Colombia), South and East Asia (India and Pakistan) and Sub-Saharan Africa (Ghana and Kenya).
Of the 54 countries included in the 2010 index, 29 boosted their scores, 21 slipped in the ranking, and four stayed unchanged.