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> Posted by Jeffrey Riecke, Communications Associate, CFI
In addition to its other benefits, microfinance can be a vehicle for promoting environmentally sustainable development. Small-scale finance, when bundled with other services, can improve access to clean energy for people at the base of the pyramid, and can assist them to protect ecosystems, conserve biodiversity, and adapt to climate change. And for the poor, climate change mitigation and adaptation is critical. Although poor people have contributed the least to climate change, according to the United Nations, they will suffer its effects in the biggest way. Though still a burgeoning area, a number of microfinance institutions are effectively pairing microfinance and environmental action, including Kompanion Financial Group in Kyrgyzstan, ESAF Microfinance in India, and XacBank in Mongolia. A few weeks ago at European Microfinance Week (EMW) these three institutions were acknowledged for their work in this area, with Kompanion winning the 5th European Microfinance and Environment Award, and ESAF and XacBank placing as runner-ups.
The Microfinance and Environment Award, launched in 2005, recognizes institutions committed to serving the poor while contributing to environmental sustainability. It’s jointly organized by the Development Cooperation Directorate, the European Microfinance Platform (e-MFP), and the Inclusive Finance Network Luxembourg in collaboration with the European Investment Bank. Below is a snapshot of the environmental efforts of the three institutions, featuring the videos that were shown at EMW.
> Posted by Jeffrey Riecke, Communications Associate, CFI
As if we needed more motivation to support the expansion of microinsurance, the increase in extreme weather is highlighting the ability of the financial service to spur climate change adaptation.
Farming in developing countries is responsible for 70 percent of the world’s food supply, and farmers in developing countries are vulnerable to the effects of climate change. What will happen to the world’s food and to those making a living from small-scale agriculture when the frequency and intensity of extreme weather arising from climate change take stronger hold?
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