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Discours de S.A.R. la Grande-Duchesse lors de la conférence "Microfinance, la fin d’une success story ?" au KfW de Berlin le 24 avril 2012



Key Note Speech I. K. H. Grossherzoging von Luxemburg

Mikrofinanzierung-Ende einer Erfolgsgeschichte?

24 April 2012 um 13h00in der KfW, Niederlassung Berlin


Ladies and Gentlemen,

I am truly grateful for the opportunity you have given me to participate in this panel discussion at KfW Entwicklungsbank to share with you some thoughts on the challenges we face in the area of microfinance, a subject of great importance to me!

“Microfinance – the end of a success story?”. The title of our discussion may sound somewhat provocative, but the wording contains an affirmation: microfinance has been for nearly 40 years a success story! This may be obvious to all of us, but the long-term success of this great concept, is now being contested by those who, for various reasons, discredit the whole idea by focusing on negative examples and bad practices.

We must recognize that, despite recent events in Bangladesh and India, microcredit is to this day, one, if not the most efficient tool in the eradication of misery. As we meet here, it is benefiting millions of micro-entrepreneurs and families throughout the world. "Microcredit is a macro idea", said US Secretary of State Hillary Clinton: (and she pursues)

"Microcredit has positive consequences on the entire community and creates a fertile soil for democracy to grow because women and men can hope in the future of the planet again. We must realize that our destiny is strongly linked to the destiny of the poorest on this planet."

After years of visits in the field, both in Bangladesh and in various African and Latin American countries, I can confirm that this credit tool initiates a virtuous cycle and it restores dignity to women and men who should never have lost it.

May I give you a concrete example:

Years ago in Bangladesh, I met a mother with her 8 year old boy in a village where the Grameen Bamk is active.

10 years later, I returned to find that the young boy had become a handsome 18 year-old young man who stood up next to his proud mother. He told me in perfect English that thanks to the loans of the Grameen Bank and his mother’s hard work, he was now studying to become a pilot in the bengladesh national airlines

I was very moved of course as  Prof. Yunus said to me:

In my wildest dreams would I have thought that any of the 1st generation of Grameen Bank beneficiaries – children, would not only finish primary and secondary school, but reach a university level!

This is not always the case of course but there are nevertheless millions of stories moving and inspiring that should be shared. I hope that this one illustrates the fact that microcredit most often provokes a demand for education, that transforms people’s lives. As Frederico Mayor, the former director general of Unesco puts it: “If the recipients of microcredits also have access to education, its empowering effect increases the impact of that microcredit in an exponential manner”.


Ladies and Gentlemen,

Microfinance is not only a fascinating success story initiated by Muhammad Yunus in 1974, it also stands for millions of individual success stories since.

It is furthermore a significant tool in the achievement of the United Nations Millennium Goals.

Charity and aid do remain vital, but the use of microcredit brings a fundamental new opportunity to millions of men and women who no longer live as victims but as actors of their own lives.

We therefore have a duty in promoting microfinance:

  • to show its potential whilst being aware of its limits
  • to highlight more effectively the social outcomes and take them into account
  • and to denounce strongly the misuse of microcredit such as: excess funding, unfair competition among MFIs and aggressive expansion of finance institutions.

Damian von Stauffenberg, an eminent expert and director of MicroRate, makes it clear:

“Microfinance faces the double challenge of keeping expectations as well as abuses, in check.”

There is an ever-present danger that the microfinance industry, which is now a still growing billion-euro market, may neglect the initial idea of solving a social problem, by instead concentrating on the “money business”.

The success of microfinance institutions has been measured for far too long on the basis of financial performance outcomes, yet such indicators tell only part of the performance story! Stakeholders should also focus on how their efforts have improved lives and in what way they can meet their customers’ needs more efficiently in the future.

This is why, initiatives like the “Paris Appeal for Responsible Microfinance”, which I personally signed at the European Microfinance Week 2011 in Luxembourg, are very important in our common fight against the excessive commercialization of microfinance.

Furthermore, we need a classification of the different microcredit types, from low to excessive interest rates, and clear operating-licenses, for the Micro-Finance Institutions. This would be a way to reduce the space of the so called “loan-sharks”.

Nobody has the right to exploit his clients, under any circumstances and much less in the microfinance field!

Microcredit should be considered as a social business, dedicated to achieving a social goal by empowering the most vulnerable in our societies who are definitely not the less intelligent, creative or hard working!


Ladies and Gentlemen,

Since the early 90s, when the first NGOs specializing in microfinance were set up, Luxembourg has demonstrated a strong and consistent commitment to microfinance.

Today Luxembourg is home to about 30 investment funds, who through MFIs provide funding to millions of micro-entrepreneurs. The microfinance and inclusive finance sector are characterised by a holistic approach and a multi-stakeholder initiative, bringing together actors of the private sector, the public sector and the civil society.

Most of them are represented at the “Luxembourg Round Table on Microfinance”.

The Grand Duchy also hosts the secretariat of the “European Microfinance Platform”, which organises important events such as the “European Microfinance Week” and the “European Microfinance Award”.

As wife of a Head of State, as Honorary President of the Luxembourg Fund Labeling Agency LuxFlag and board- member of the Grameen Crédit Agricole Microfinance Foundation, I try to promote the microcredit model as a creative tool for economic and social integration, for justice and peace. I am very glad to be – as you all – part of this ongoing success story.  

Let us do everything in our power for it to flourish.


Thank you very much for your commitment and your kind attention.