Evaluation of the MIF Projects: Microfinance

This paper presents evaluation of the Microfinance Investment Fund (MIF) microfinance projects. It gives the overall economic context of Latin America and Caribbean, where the projects are being implemented. It also identifies the strategy underlying actions and interventions by the Inter-American Development Bank and MIF to develop and support microfinance projects.

Against this background, the paper discusses the evaluation of 24 MIF microfinance projects against the following aspects:

• Relevance: Projects tailor-made to suit client needs were found to be more relevant;
• Effectiveness: Projects supported with equity investment and loans were more effective;
• Efficiency: Progress in processing times, hiring and procurement were observed;
• Innovation: Over 60% projects were found to be innovative;
• Sustainability: Careful selection of participating agencies and involvement of stakes such as equity and venture capital ensured sustainability;
• Evaluability: Suitable financial indicators were developed to assess the impact.

Finally, the paper assimilates lessons from the study that contributed to the success of projects at large:

• Availability of technical assistance;
• Favorable legal and regulatory environment;
• Optimal method of financing.

The paper concludes with a reflection on areas of opportunity for MIF interventions in financial sector deepening.