importance of easy access to credit for the poorest section, the Summit urgedgovernments of nations to give a new thought to their legal, regulatory and institutionalframeworks in order to make credit easily accessible to the poor. Subsequently, in 1997the World Micro Credit Summit at Washington DC announced a global target of ensuringdelivery of credit to 100 million of the world’s poorest families, especially the woman of these families by 2005 which was achieved well ahead in time.Since the launch of the Millennium Development Goals (MDGs)
at theMillennium Summit in New York in September 2000, the MDGs have become a widelyaccepted yardstick of development efforts. The first and foremost goal, among others, isto eradicate extreme poverty and hunger. This goal targeted to halve the proportion of people whose income is less then US$ 1 a day and the proportion of people who suffer from hunger between 1990 and 2015(UN,2001). Almost all the countries in the world,including India have committed themselves to attaining the targets by 2015 as embodiedin the Millennium Declaration. Resorting to these resolutions, many developing countrieshave put micro finance in their agenda as a tool of reaching the MGDs.
2. Best Practices
Over the past decade, microfinance institutions have adopted innovative ways of providing credit and savings services to the entrepreneurial poor. An innovative approachthat has been used successfully by Grameen Bank's credit-delivery system is "peer-groupmonitoring" to reduce lending risk, although some studies have suggested that the reasonfor the Grameen Bank's high repayment rates is also partly due to the practice of weeklymeetings - at which attendance is compulsory - for the repayment of loan installmentsand the collection of savings. It is reported that the meetings reinforce a culture of discipline, routine repayments and accountability. Not all microfinance institutions use peer-group monitoring. Other institutions such as the Bank Rakyat of Indonesia, whichserves 2.5 million clients and 12 million small savers, rely on character references andlocally recruited lending agents in place of physical collateral. Thailand's Bank of Agriculture and Agricultural Cooperatives serves approximately 1 million micro- borrowers and 3.6 million micro-savers. Newcomers such as the Association for SocialAdvancement of Bangladesh, with half a million clients, and the People's Credit Funds of Vietnam with more than 200,000 members or clients, are other examples of the potential