Microfinance system and microfinance model suggestion for turkey

In our recent days, the products and the services constantly increase for the ones who have physical capabilities for them to reach while on the other hand the number of people who have difficulties to fulfill their vital needs also constantly increase. Recently, approximately one fifth of the world?s population try to live with less than 1 Dollar per day and the challenge with the poverty becomes more important by the day. Microfinance system is seen as one of the most powerful tools for the challenge with the poverty and it contains the credits and the financial services for the low incomer people to make their livings, to bring forward their potentials and to enable them to establish their own enterprising. Microfinance system came into the scene during the years of 1970s and as of 2006, 114 million customers have been reached in 114 countries through 3.133 microfinance establishments. Although it has shown a rapid progress in the world, there is no microfinance application in Turkey covering it complete meaning. Yet, when the number of micro and small scaled enterprising are considered with the low and inconsiderable incomer household, it can be said that there is a big potential in Turkey for microfinance. In the work, first the microfinance application in the world is examined with it general terms. After that, two big microfinance establishments, Grameen Bank and Banco Solidario S.A. have been taken in hand with the details of their corporate structures, target community, credit delivery process, financial products and fund resources. In this direction, by taking into consideration the qualifications of the successful microfinance establishments and the circumstances of Turkey, two different model suggestions have been made for the establishments of microfinance entities in Turkey. Within the scope of model suggestions, the answers were tried to be given for the legal infrastructures of the microfinance establishments, from whom the target community should be configured, how should be the credit availability period and which types of financial products must be presented by these entities. Key Words: 1. Microcredit 2. Microfinance 3. Microfinance Institution 4. Poverty 5. Model Suggestion