Housing microfinance – a key to improving habitat and the sustainability of microfinance institutions
Not only low- but also most middle-income urban inhabitants in developing countries are unable to take out mortgages to purchase housing. The usual route to home purchase or improvement requires small, regular short-term loans, and these characteristics make microfinance institutions, rather than banks, the natural providers of housing loans. This paper first examines the potential of HMF and asks why it has yet to achieve significant scale. It describes what has been attempted so far and suggests what donors and MFIs might do to ramp-up this product.