Marie Michael Library

Poverty assessment by microfinance institutions: a review of current practice

Hatch, John K.; Frederick, Laura

This paper looks at methods used by microfinance institutions to assess the poverty level of potential or new clients. The paper categorizes methods of poverty assessment, then evaluates the methods according to six technical criteria that reflect the ease of use of the method for the microfinance institution and the strength of the information the method provides. The paper concludes with recommendations to help institutions select a poverty assessment strategy that it appropriate for their clientele, institutional objectives, and operating conditions.