Microfinance in Post-Disaster and Post-Conflict Situations: Turning Victims into Shareholders

This article studies the role of member-owned institutions (MOIs) in the provision of the reparations for victims of human rights abuses or reconstruction in post-conflict and post-disaster situations. It discusses:

• The role of microfinance institutions (MFIs) in post-conflict or post-disaster situations;
• The challenge of sustainable impact of reparation payments for civil rights abuses;
• Framework for reparation payments;
• The transition of non-government organizations (NGOs) to member-owned local financial institutions;
• Linkages between formal and informal finance.

The article concludes that:

• Grants usually awarded for reconstruction in post-conflict areas or for reparation payments in post-disaster areas could be best turned into equity and deposits to foster MOIs;
• NGOs and MFIs could be instrumental in using reparation payments to promote the establishment, growth, and development of sustainable local financial institutions co-owned by recipients of reparation payments.