Members of Congress Call on World Bank to Support Microfinance for the Very Poor

Thirty Senators urge Bank President Zoellick to devote more resources to reaching the very poor

Washington, DC (February 8, 2008) — Thirty senators have signed on to a letter to World Bank President Robert Zoellick urging him to ensure that the Bank invests more in microfinance and, most important, ensures that at least half of all microfinance resources benefit the very poor. The letter was initiated by Senators Robert Bennett (R-UT), Richard Durbin (D-IL), Michael Enzi (R-WY), and Sherrod Brown (D-OH). The 30 signers include the leading Democratic presidential candidates Senators Hillary Clinton (D-NY) and Barack Obama (D-IL)and the top Republican on the Senate Foreign Relations Committee, Richard Lugar (R-IN).

“Microfinance has the power to transform the lives of the poorest people in our world by providing them access to small loans to start individual businesses, a safe place to save, and peer support,” the letter states. “Microfinance gives borrowers, especially women, the capacity to improve the quality of their lives and the futures of their children.”

Although the Bank has previously acknowledged the effectiveness of microfinance, it devotes very little of its annual budget to microfinance institutions (MFIs). It is also very difficult to track funds allocated to microfinance. Some estimates have suggested that the Bank spends as little as one percent on microfinance.

The thirty senators — or nearly one-third of the Senate — who signed the letter included 11 Republicans, 20 Democrats and one Independent, demonstrating the enormous bipartisan support for this issue. The letter was supported by RESULTS Educational Fund, a national grassroots education and advocacy organization that works to expand support for microfinance and other poverty reduction priorities around the world. A similar letter also was circulated in the House, and garnered 43 signers. Last October, 29 members of Congress met with World Bank President Zoellick to discuss this issue. Zoellick promised to hold further discussions, but no follow-up meeting has yet been scheduled. Representatives Rush Holt (D-NJ) and John Carter (R-TX) are leading the House effort.

The Senate and House letters urge the World Bank to take four specific steps to ensure that more microfinance funding reaches the very poor: 1) double its investment in microfinance to at least two percent of its program spending; 2) ensure that at least 50 percent of those funds reach clients who are in the bottom half of those living below their nation’s poverty line); 3) implement cost-effective poverty measurement tools to ensure compliance; and 4) report annually on the results.

“The range of Senate signers is quite impressive,” said RESULTS founder and Microcredit Summit DirectorSam Daley-Harris. “Signers include the two conservative senators from Utah, Mr. Bennett and Mr. Hatch; the two liberal senators from California, Ms. Feinstein and Ms. Boxer; the top Republican on the Senate Foreign Relations Committee, Mr. Lugar; and the two Democratic Party presidential candidates Ms. Clinton and Mr. Obama. The bipartisan support for this is issue is something the World Bank President cannot ignore.”

The final signers of the letter in the Senate include: Bennett (R-UT), Durbin (D-IL), Enzi (R-WY), Brown (D-OH), Murkowski (R-AK), Lieberman (I-CT), Cardin (D-MD), Bayh (D-IN), Murray (D-WA), Boxer (D-CA), Stabenow (D-MI), Hatch (R-UT), Lugar (R-IN), Chambliss (R-GA), Levin (D-MI), Coleman (R-MN), Nelson (D-FL), Casey (D-PA), Mikulski (D-MD), Klobuchar (D-MN), Inhofe (R-OK), Isakson (R-GA), Obama (D-IL), Clinton (D-NY), Schumer (D-NY), Feinstein (D-CA), Burr (R-NC), McCaskill (D-MO), Martinez (R-FL), Cantwell (D-WA).

In the House, the final signers are: Holt (D-NJ), Carter (R-TX), Moran (D-VA), Hastings (D-FL), James McGovern (D-MA), Matheson (D-UT), Steve Cohen (D-TN), Baldwin (D-WI), Honda (D-CA), Bordallo (D-GU), Gonzalez (D-TX), Ros-Lehtinen (R-FL), Rohrabacher (R-CA), Inslee (D-WA), McDermott (D-WA), Rothman (D-NJ), Harman (D-CA), Waxman (D-CA), Capps (D-CA), Payne (D-NJ), Walberg (R-MI), Conyers (D-MI), Sullivan (R-OK), Kildee (D-MI), Wilson (R-NM), McCotter (R-MI), Berkley (D-NV), Dicks (D-WA), Doggett (D-TX), Inglis (R-SC), Murphy (D-PA), Davis (D-CA), Farr (D-CA), Shuler (D-NC), Souder (R-IN), Filner (D-CA), Larsen (D-WA), Conaway (R-TX), Udall (D-CO), Lewis (D-GA), Waters (D-CA), Smith (D-WA), Saxton (R-NJ), Sires (D-NJ), Ellison (D-MN), Reichert (D-WA).