| Abstract: |
There are manifold reasons for microfinance association; the most common ones
are advocacy, information, capacity building. However, the one unifying
rationale of this organisational type appears to be wanting. The following
paper makes two cases about the rationale of MF associations: 1. MF
associations should NOT be regulatory bodies. In Uganda and elsewhere, there
is a tendency to transform associations into apexes, to use them for
regulation tasks. This is based on two motives: On the one hand, due to
under-conceptualisation of associations, their promoters tend to see a
promising opportunity in some regulatory role; its impact is often not well
understood or neglected. On the other hand, some government agencies that lack
resources and reliable systems for fulfilling regulatory tasks tend to see
apexes as a convenient "quick fix." 2. The competitive edge of MF associations
lies in improving informational efficiency of the Microfinance sector. MF
associations are uniquely positioned to compile data for creation of
information – e. g. performance monitoring – that are barred to any other
organisation. MF associations should be built around that objective and judged
by it. Many interventions oscillate around partial issues of informational
efficiency, e. g. credit reference and rating services. Yet, its
conceptualisation has been curiously neglected by development partners.
Consequently appreciation has been insufficient regarding the specific,
impressive management demands faced by MF associations. These are the
conclusions of over 2 years working with AMFIU. AMFIU, the microfinance
association of Uganda, has been commended as one of the leading MF
associations of Africa. AMFIU grew its membership and expanded its operations
impressively. In its 12th year of existence, AMFIU membership represents about
three quarter of the Ugandan microfinance sector in terms of portfolio and
client outreach. |