With the recent change in the global market this year, how should microfinance institutions response the situation? Is there any practical actions they can do to help people who are adversely affected by the situation?
I personally think this is the high time when microfinance should limit their lending because the return of investment in this situation is questionable. It is better to invest their credit on temperary basis at any credit agency when they get profit and survive.
They should start lending ASAP when the Corona will be over.
The best way for MFIs is to also manage social finance as well.
For Islamic MFIs, it is easier since they could manage Islamic social finance such as zakat, infaq and waqf, including cash waqf to strengthen their equity as waqf equity, or as long term deposits.
Microfinance can survival by designing programs that support business recovery from the virus. With that microfinance can secure funding from donor agencies and government agencies to run such programs.
Also, the government can use microfinance as the channels to implement the business recovery programs especially for small business
Hope this helps
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