According to the World Bank, there are more than 500 million economically active poor individuals in the world operating microenterprises and small businesses, and most of them do not have access to financial services. One of the ways by which their demand for financial services has been met is through the provisions of microcredit. The microfinance industry has been very successful in helping the poor to obtain necessary financial resources for entrepreneurship purposes, as the support for such activities is perceived to reduce poverty and empower certain segments of the population. However, there are still a vast number of poor individuals who have not been able to benefit from this financial assistance, which clearly points out the need for the microfinance industry to grow and become more sustainable. It needs to generate greater support from the donors as well as to play a greater role in the financial sector.

The course is designed to help participants learn about sustainable microfinance in terms of principles and good practices as they are applied by worldwide institutions today. It provides a comprehensive overview of the microeconomic fundamentals and how microfinance activities are implemented, evaluated, and managed. It will also help individuals gain greater insight into microfinance practices.

At the end of the course, the participants should be able to:

• Understand the concept and principles of microfinance;
  
• Identify issues that hinder the success of microfinance in their country;
  
• Appraise the state of microfinance in their respective country;
  
• Explain to a group of would-be operators of microenterprises and small businesses the significant components of microfinance such as financial instruments and lending methodologies, performance evaluation and management, and preparing financial statements; and
  
• Recommend positive approaches that will facilitate the poor's access to financial services.

The target audience are professionals who want to learn about sustainable microfinance as it is practiced today, as well as individuals who are involved in microfinance operations and want to see how their work fits into global microfinance initiatives. The course is also useful for experts in other fields who wish to understand the importance of microfinance as a development tool.
 

Course Structure

This online course will involve a mix of self-study and online interaction culminating in a practical understanding of fundamentals of microfinance through online group work. Throughout the duration of the course, participants will go through theoretical and conceptual material prepared by UNITAR and will have an opportunity to relate it to real-life situations through online discussions and peer-to-peer interaction. There will be a quiz/assignment at the end of the course which is a requirement for obtaining a course certificate.

Course Outline

The course consists of the following modules:

Module 1: The World of Microfinance
This Module will give participants some general insights as to what microfinance is, who are its clients, what services does it offer, and what are the risks that the sector faces; the concepts which will be discussed in greater detail in later modules. This Module will also provide participants with some short historical background on microfinance and its current growth.

Module 2: Financial Analysis
This Module will discuss the significance of the microfinance sector in a country and the importance of macro-level policy and regulations for developing microfinance providers and microenterprises. The Module will examine how clients are selected for microfinance services and will analyse the different range of products and services that a microfinance institutions might offer and the factors that influence its decision. The Module will also examine the range of institutional types and other relevant issues that are appropriate for microfinance.

Module 3: Financial Instruments and Lending Methodologies in Microfinance
This Module will analyse the different elements of lending products and the way in which these elements affect both borrowers and the viability of the microfinance institution. It will discuss the designing of different financial products by the microfinance institution that are specifically geared to the target market, meets the needs of its clients and also the capacity of the microfinance institution. It will discuss various methods to calculate the appropriate loan amounts, loan terms, collateral requirements, interest rates and fee, and compulsory savings.

Module 4: Measuring Performance and Future Growth of Microfinance
This Module will discuss the reasons for various adjustments that need to be made to the balance sheets and income statements of the microfinance institution before analyzing its financial performance, identify the ways to determine appropriate adjustments, and ways to make them. The Module will discuss how to calculate performance indicators that provide information about different areas of microfinance operations and will examine the usefulness of the performance indicators are useful in terms of determining the efficiency, viability, and outreach of microfinance institutions. The Module will also discuss various operational issues affecting financial performance and how they can be effectively manage to improve the performance of a microfinance institution.

This Module will also briefly discuss various factors that might jeopardize the effectiveness of microenterprises. It will also discuss some of the political and legal aspects that need to be considered in terms of microenterprise expansion.
 

UNITAR online courses attempt to create a networked learning environment, in which participants have the flexibility to learn at their own convenience and pace but also are able to interact with peers and experts through the discussion board facility.

This online course will be conducted in the English language.
 

This course is designed as an online course in which participants will be primarily responsible for their own learning. Each lesson will consist of the following components:

1) Basic Reading Materials (Compulsory Reading Materials): these materials are intended to educate the participants about the basic concepts and principles applicable to the subject-matter of the lesson. It will include, where appropriate, sample materials. These materials will constitute the required reading materials for the lesson

2) Advanced Reading Materials (Optional Reading Materials): this will consist of optional reading materials for participants who wish to learn more about the topic than what is covered in the lesson.

3) External Links: This will refer the interested participants to additional books, articles, documents, and websites that deal with the issues raised in the lesson.

4) Quizzes: At the end of each lesson there will be a set of quizzes for participants to answer. These quizzes are designed to test the participant's understanding of the lesson. Participants are required to pass each quiz and obtain at least 80% or more passing grade in order to be eligible for a certificate. All quizzes will need to be taken online.

5) Community Discussion Board: There will be a community discussion board available on which participants can post questions or comments that can be seen by the instructor and the other participants. This discussion board will be moderated by the course director and UNITAR. Structured discussion strings will be posted on a weekly basis.

All successful participants will be eligible to a certificate after completion of this online course.