Linking Microfinance, Poverty and HIV/AIDS: Theoretical and Empirical Review

This paper states that if microfinance can reduce poverty, then it could also be used as a powerful tool for preventing HIV/AIDS. It reviews theoretical and empirical literature about poverty, HIV/AIDS and microfinance.

The people most at risk from HIV/AIDS are the poor, particularly the women. High levels of poverty force women to seek alternative means of livelihood, as a result of which they contract HIV/AIDS. Microfinance institutions can assist clients in protecting their income and assets from the impact HIV/AIDS and related diseases.

The paper proposes a conceptual framework that links microfinance, poverty and HIV/AIDS. In this model:

• Poverty plays an intermediary role;
• Combination of financial and non-financial services reduces poverty levels, resulting in a trickle down effect on the family as well as on society;
• Right wing of the model comprises financial services that benefit the poor in a variety of ways like increasing their income, making them self-sufficient and empowering women;
• Left wing of the model comprises non-financial services such as education, counseling and business advisory services;
• Right and left wing together result in reducing social exclusion and sexual exploitation, which are the risk factors for HIV/AIDS.