What is technical assistance?
Technical assistance helps microfinance institutions work successfully. This can happen in different ways. The internal processes of MFIs can be improved, specific areas such as risk management or information management can be strengthened, and new products can be introduced. Importantly, no subsidies are granted to uneconomical structures, but rather the operations of the MFI are strengthened through the input of know-how.  Microfinance is a market. Accordingly, support of microfinance must ensure that the market is not distorted.

Why technical assistance?
The demand for financial services is very large in threshold and developing countries. In order to cover the associated capital requirements on the free capital market, MFIs must meet certain international standards. Only then do they earn the necessary confidence of investors. Only a fraction of the currently active MFIs meet these standards. Technical assistance aims to increase the share of well-managed and professionally functioning MFIs. This increases the number of institutions that are interesting for microfinance funds and other financial sources. This represents an important contribution to the sustainability of MFIs. Profitable institutions can survive over the long run and generate the performance that clients need.