| By: |
Llanto, Gilberto M.;
Laviña, Gabrielle Roanne |
| Abstract: |
<br>The paper reviews the innovations developed by some financial institutions
to meet the challenges of microfinance and rural finance markets. Innovations
could be new products and methodologies or refinements to existing practices
that are created in response to market inefficiencies and changing demands of
a target clientele. Essentially, innovations by financial institutions are not
only a means to reach the large unserved poor households but also to provide
more and better products and services that could contribute to increasing
profitability of the institutions adopting them.</br> <br>The first type is
innovations on the financial system which refers to changes in the structure
of the financial sector particularly in the legal and regulatory framework.
The second type of innovation is institutional innovation which deals with the
changes in the structure, organization, and legal form of the institution.
Another type of innovation is the process innovation. This refers to the
introduction of new business processes leading to increased efficiency or
market expansion (most often associated with technological progress). The last
type of innovations is products innovation which refers to the introduction of
new or modified products or services tailored to the needs of the rural
borrowers.</br> |
| Keywords: |
microfinance, rural finance, innovation, institutional innovation, products innovation, process innovation, systemic level of innovation, scarcity of collateral, leasing |
| Date: |
2006 |
| URL: |
http://d.repec.org/n?u=RePEc:phd:dpaper:dp_2006-24&r=mfd |