Comparative Analysis of Innovation between Vietnam’s Microfinance System and International Benchmarks

Tóm tắt

Microfinance is seen as an appropriate solution to poverty in developing countries. However, its development is not in a single model for all countries. The poor in different countries are facing different circumstances, which generate different demands for financial products and services. Though in the beginning of microfinance establishment, all governments provide funding to help the existence and development of the microfinance programs, this is not the manner that can transform microfinance into an integral part of the national financial system and provide financially independent and long-term growth to microfinance institutions. The differences in the financial characteristics and needs of the poor in the countries, and the development of the microfinance sector itself, have made governments opt for their own solutions to develop microfinance. Although it is impossible to build a single formula for the development model of microfinance, it is helpful to compare the innovation of Vietnam’s microfinance system with two globally famous systems, namely Grameen Bank and the Bank Rakyat of Indonesia (BRI). Besides the lessons learned from the success of large international microfinance organizations, comparative analysis of microfinance implemented in different environments with different methods help find the answers for research questions: which models of microfinance institutions suit certain socio-economic conditions, and what is better - developing non-profit microfinance or that of commercial purposes in the context of Vietnam.