Management Principles in Socially Inclusive Microfinance Institutions: Experience of Latvian Cooperative Savings and Credit Unions
Keywords:cooperative savings and credit unions, microfinance, socially inclusive business model, poverty, social exclusion, financial exclusion
AbstractIn the times of turmoil, the role of inclusive business models is increasing. Cooperative Savings and Credit Union (CSCU) is the only formal socially inclusive and self-sustainable business model, operating on Latvian financial market. The purpose of this paper is to analyze peculiarities of operation and management of CSCUs, to find main problems and develop proposals for the improvement of CSCUs’ operation and increase of their social potential in the country. The paper consists of two main parts. The theoretical part covers current issues dedicated to the development of business models, solution of social problems, microfinance principles, and operation peculiarities of CSCUs. The analytically-practical part covers the analysis of Latvian CSCUs operational data for the last decade, a longitudional study of management principles in Latvian CSCUs, based on repeated questionnaire of a definite sample (n=10, N=34) of CSCUs in 2009 and 2012, and the proposals for improving CSCUs operation.
SPECIFICS OF CONTEMPORARY ENTERPRISE ACTIVITIES