The Life Cycle of a Microfinance Institution: An Economic Analysis of the Irish Loan Funds
Posted: 7 Feb 2002
Ireland's loan funds were a long-lived, self-sustaining, large-scale microfinance organization that made millions of loans, without collateral, to the poor. During the first hundred years of their life-cycle, a period of growth ending in the 1840s, they adapted constantly and obtained improvements to their legal structure because they were complementary to the banking system and seen as effective in relieving poverty. In their second century they became ossified, in part because of competition with commercial banks. The loan funds provide an example of sustainable microfinance under harsh economic conditions and illustrate how organizations change incrementally and, when successful, alter their institutional framework.
Keywords: microfinance, Ireland, New Institutional Economics
JEL Classification: N23, O16
Suggested Citation: Suggested Citation