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MDG 5: Ensure environmental sustainability

Environmentally sustainable development can improve the livelihoods of rural clients by allowing them to invest in income-producing, yet environmentally sound, activities. In an effort to effectively use and preserve natural resources while improving the economic and social welfare of their clients, several MFIs are currently integrating sustainable development concerns into their credit services.

Although many microfinance practitioners are actively making the link between microfinance and environmental sustainability, there are as yet no impact studies in this area. In lieu of impact studies, the resources cited below are either a) technical papers that outline strategic steps for integrating microfinance with environmentally sustainable projects or b) links to MFIs currently doing this kind of work.

Lal, Abhishek. An Overview of Microfinance and Environmental Management. Green Microfinance Working Paper, July 2001.

  • This paper focuses on the opportunities for MFIs to promote environmentally sustainable development in the developing world.

Pallen, Dean. The Environmental Sourcebook for Micro-Finance Institutions (MFIs). Quebec: Canadian International Development Agency, 1997.

  • This publication is a sourcebook designed to help MFIs improve the environmental performance of their lending activities. Although MFIs are the target audience, the publication is useful to anyone involved in microenterprise development.

Varley, Robert C.G. Financial Services and Environmental Health: Household Credit for Water and Sanitation. Environmental Health Project Applied Study No. 2, January 1995.

  • This paper is directed at technical professional staff in USAID who design programs and projects. It advocates using MFIs as an integral component of a financing strategy to increase the water supply and sanitation coverage in urban and peri-urban areas in the developing world.

Conservation International

  • This organization supports the development of microenterprise in over 20 countries while promoting the preservation of natural resources and livelihoods of local communities.

Grameen Shakti

  • This organization provides an integrated package of technology and financing to promote the use of renewable energy resources in poor areas in Bangladesh.

Green Microfinance

  • The mission of Green Microfinance is to enhance the environmental performance of microenterprise.

Solar Electric Light Fund (SELF)

  • This organization facilitates access to microcredit for poor rural families to enable them to purchase a solar home system.
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