Title: Microfinance Charity | GiveWell
Headings: Microfinance Charity
Microfinance Charity
How do charities help?
What are the challenges of finding a great microfinance charity?
Giving to microfinance organizations

Content: See our discussion on our blog .) Previously, we examined microfinance organizations using a set of critical questions both about microlending and microsavings. In searching for institutions with strong answers to these questions, we found that: The large U.S. microfinance charities were rarely clear about their value-added. To the extent that we were able to obtain and review due diligence on partners (most of which is unfortunately confidential), it seemed focused on financial performance, with much weaker examination of social impact-related questions. ( See also our discussion of the NIgerian organization LAPO as a case study .) There is an argument for focusing on financial performance over social impact, in the hopes of creating self-sustaining microfinance institutions and reaching as many people as possible. However, we have concerns about mixing donations with for-profit enterprises, with the possible result that donations end up padding profits ( concept; example ). We found that organizations hoping to use donations to start for-profit microfinance institutions are (perhaps for good reasons) rarely willing to share substantive information about their track record.