Facts on Microfinance and Decent Work

This newsletter discusses how the International Labor Organization (ILO) can make use of microfinance to meet the poverty challenge. It states that:

• The ILO promotes opportunities for women and men to obtain decent and productive work.
• Microfinance contributes to decent work by providing opportunities for:
  • Small investments in self-employment and job creation;
  • Managing risk through micro-savings and micro-insurance.

The newsletter describes the contributions of microfinance in the following areas:

• Job creation;
• Empowerment of women;
• Reducing vulnerability.

The newsletter also presents an overview of the ILO Social Finance Program, stating that:

• It aims to:
  • Reduce vulnerability;
  • Invest in job creation;
  • Make financial policies more employment focused.
• It focuses on:
  • Institutions that work for the poor;
  • Market imperfections and social costs;
  • Policies that help the working poor access markets.
• It undertakes action research to:
  • Show the viability of microfinance;
  • Monitor and assess the impact of microfinance on household income and assets.
• The ILO has pioneered several microfinance applications;
• This work has been carried out in partnership with ILO constituents like trade unions, worker banks and employer organizations.

The newsletter also provides information about:

• The ILOs microfinance initiatives that seek to abolish forced labor and child labor;
• A case study on microfinance and bonded labor;
• The challenges that microfinance faces in the International Year of Micro-credit.