CHAPTER

6

SMALL LOANS: SHELTER MICROFINANCE1

SMALL LOAN CHALLENGES

Shelter has become a commodity for increasing numbers of low-income households, especially those living in urban areas of developing countries. Those who build incrementally (or progressively) are a very significant group in many countries in the South. However, loan finance for shelter-related investments in incremental dwellings made by low-income households whose income comes from the informal economy is rarely available through the formal commercial financial sector. In the vast majority of cases, these households are ineligible for commercial mortgage finance. Households seeking to invest in their shelter (land, infrastructure and housing) have been forced to use their own ...

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