Microfinance Institution and Ideal Situation of The Social Contribution

Meaning of the social contribution by Microfinance institution

We think it’s the most effective method to support the poor directly by a microfinance institution out of a lot of ways to support the poor. Commonly, the main way to support the poor are through donation organizations, however to grasp the actual situation and judge for liability can be challenging as it is difficult to collect accurate information of the poor. In the case of a Microfinance Institution (MFI), this business activity such as lending leads to support the poor. MFIs confirm the information rooted in a business area to find clients. For this reason, MFIs know where the poor stay and recognize what they really want to have; this differentiates itself from donation organizations after receiving the request from the poor. For MFIs, their business can lead to support the poor and find accurate information connecting donations. Thus there are no additional human expenses to find areas that need support. Lastly, MFIs can offer cost effective support because MFI staff know local price of supporting items and services for the poor. From the above, we hope understanding our MFI business model and support for the poor have a high affinity, if so it would be possible for us to implement the social contribution more effectively compared to other institutions.

Ideal situation of social contribution activities

Referring to the orphanage situation, social contribution activities are required to be continuous. There are many cases in which single support systems don’t lead to fundamental resolution; it is therefore difficult for everybody, not only for the poor to use resources in a planned manner when funds or goods have been received. As many of the poor do not have the capabilities to use it in a planned manner, the lifestyle becomes temporary, immediately after the support has finished.
Even if there is experience of having support, there is an observable tendency that the people get lazier by expecting to having support in the future. Therefore we should be deeply aroused that social contribution without persistence has a possibility to cause the poor more suffering. There needs to be a strong management base to continue and expand supporting the poor with persistence. This project supported by APF can implement social contribution activity more effectively and continuously. This support makes APF’s business stronger and does not make funds for donations for social contribution directly. This support will help APF to expand their business which will then allow APF to have information of the poor who need support. By expanding the business, APF will be possible to support the poor more effectively and continuously using their business profit.
This is a tangible achievement reachable by a strong management base, APF aims to be a Specialized Bank from a Microfinance institution.