Document: The role and importance of savings and credit cooperatives in microfinancing and the worldwide activities of the DGRV

Income is crucial if basic needs are to be met in a sustainable manner. Yet income is only generated by individuals who have an opportunity to take part in economic activities. It is possible to save only if there is an adequate level of income. Access to financial services and markets is therefore an essential prerequisite for self-sustained poverty reduction. Poor people have a considerable productive potential which can be mobilized by means of self-help approaches. The effectiveness of microcredits depends on whether they are managed professionally by local institutions. In many instances, the latter offer a broad range of additional financial services: savings deposits, financing of housing and insurances, and also business consultancy and advanced training. Microfinance institutions generate savings capital, mobilize local resources and promote development.