Research Report
The role of microfinance and microfinance institutions in climate change adaptation: Learning from experiences in Bangladesh
Topics: Region: Language:
English

The role of microfinance and microfinance institutions in climate change adaptation: Learning from experiences in Bangladesh

2014-06
Author: 
2015-04

This report aims to (i) conceptualise and analyse the relationships between microfinance and adaptation, (ii) map out what could be considered good microfinance practice for adaptation, or “adaptation-oriented microfinance,” and (iii) identify types of adaptation projects and activities that microfinance institutions (MFIs) could be involved in to take full advantage of their service delivery infrastructure. This report develops the concept of “adaptation-oriented microfinance” to describe microfinance that retains its focus on poverty reduction, but is engineered to maximise its adaptation benefits. Key elements of adaptation-oriented microfinance include: flexibility and customisation to enable members to select from products and product options to best manage their finances and prepare for, cope with and recover from climate shocks; sufficient access to liquidity for MFIs to support their members through extreme weather events; using loans to make adaptation technologies (particularly for agriculture) accessible to households through extension and other forms of outreach, with the aim of building climate-resilient livelihoods; loans for the construction of hazard-resistant housing; micro-insurance products with acceptable premiums that cover real risks faced by households and that incentivise risk mitigation; and a focus on outreach to the most climate-vulnerable groups, especially those in remote, ecologically fragile areas.

Page Information:
92
ISBN/ISSN:
978-4-88788-177-8