Congress finds and declares the following:
(1) Access to financial services and the development of micro, small, and medium-sized enterprises are vital factors in the stable growth of developing countries, in the development of free, open, and equitable international economic systems, and in the economic empowerment of the poor, especially women.
(2) It is therefore in the best interest of the United States to facilitate access to financial services and assist the development of micro, small, and medium-sized enterprises in developing countries, particularly enterprises owned, managed, and controlled by women.
(3) Access to financial services and the development of micro, small, and medium-sized enterprises can be supported by programs providing credit, savings, training, technical assistance, business development services, and other financial services.
(4) Given the relatively high percentage of populations living in rural areas of developing countries, and the combined high incidence of poverty in rural areas and growing income inequality between rural and urban markets, micro, small, and medium-sized enterprise programs should target both rural and urban poor.
(5) Microenterprise programs have been successful and should continue and be expanded to empower vulnerable women in the developing world. The Agency should work to ensure that recipients of development assistance for micro, small, and medium-sized enterprises under this subpart communicate and work with nongovernmental organizations and government organizations to identify and assist victims of trafficking as provided for in
(6) Given that microenterprise programs have had some success in empowering disenfranchised groups such as women, development assistance for micro, small, and medium-sized enterprises should also target populations disenfranchised due to race or ethnicity in countries where a strong relationship between poverty and race or ethnicity has been demonstrated.
(
A prior section 2211,
2019—Par. (1).
Par. (2).
Par. (3).
Par. (4).
Par. (5).
Par. (6).
"(1) Congress has demonstrated its support for microenterprise development assistance programs through the enactment of two comprehensive microenterprise laws:
"(A) The Microenterprise for Self-Reliance Act of 2000 (title I of
"(B)
"(2) The report on the effectiveness of the United States Agency for International Development's microfinance program, prepared by the Consultative Group to Assist the Poor, rated the Agency in the top tier of the 17 donors in this field.
"(3) The Comptroller General, in a report dated November 2003, found that the United States Agency for International Development has met some, but not all, of the key objectives of such microenterprise development assistance programs.
"(4) The Comptroller General's report found, among other things, the following:
"(A) Microenterprise development assistance generally can help alleviate some impacts of poverty, improve income levels and quality of life for borrowers and provide poor individuals, workers, and their families with an important coping mechanism.
"(B) Microenterprise development assistance programs of the United States Agency for International Development have encouraged women's participation in microfinance projects and, according to data of the Agency, women have comprised two-thirds or more of the micro-loan clients in Agency-funded microenterprise projects since 1997.
"(5)(A) The Comptroller General's report recommends that the Administrator of the United States Agency for International Development review the Agency's 'microenterprise results reporting' system with the goal of ensuring that its annual reporting is complete and accurate.
"(B) Specifically, the Administrator should review and reconsider the methodologies used for the collection, analysis, and reporting of data on annual spending targets, outreach to the very poor, sustainability of microfinance institutions, and the contribution of Agency's funding to the institutions it supports."
"(1) where applicable, should ensure that microenterprise development assistance provided under such title is matched by recipients with an equal amount of assistance from non-United States Government sources, including private donations, multilateral funding, commercial and concessional borrowing, savings, and program income;
"(2) should include in the report required by section 258 of the Foreign Assistance Act of 1961 [
"(3) should ensure that recipients of microenterprise development assistance under such title do not expend an unreasonably large percentage of such assistance on administrative costs;
"(4) should not use recipients of microenterprise development assistance under such title to carry out critical management functions of the Agency, including functions such as strategy development or overall management of programs in a country; and
"(5) should consult with the appropriate congressional committees with respect to the implementation of title VI of
The President is authorized to provide assistance on a non-reimbursable basis for programs in developing countries to increase the availability of credit, including the use of innovative credit scoring models, savings, financial technology, financial literacy, education, insurance, property rights, and other services to micro, small, and medium-sized enterprise clients lacking full access to capital, training, technical assistance, and business development services, through—
(1) assistance for the purpose of expanding the availability of credit, savings, and other financial and non-financial services to micro, small, and medium-sized enterprise clients, particularly clients owned, managed, and controlled by women;
(2) assistance for the purpose of training, technical assistance, and business development services for micro, small, and medium-sized enterprises to enable them to make better use of credit, to better manage their enterprises, to conduct market analysis and product development for expanding domestic and international sales, particularly to United States markets, and to increase their income and build their assets;
(3) capacity-building for financial intermediaries in order to enable them to better meet the credit, savings, and training needs of micro, small, and medium-sized enterprises;
(4) policy, regulatory programs, and research at the country level that improve the environment for micro, small, and medium-sized enterprises, financial intermediaries, and capital markets and institutions that serve the poor and very poor, especially women;
(5) assistance for the purpose of promoting the economic empowerment of women, including through increased access to financial resources and improving property rights, inheritance rights, and other legal protections; and
(6) assistance for the purpose of scaling up evidence-based graduation approaches, which include targeting the very poor and households in ultra-poverty, consumption support, promotion of savings, financial literacy, skills training, and asset transfers.
There is authorized to be established within the Agency an office to support the Agency's efforts to broaden and deepen local financial markets, expand access to appropriate financial products and services, and support the development of micro, small and medium-sized enterprises. The Office shall be headed by a Director who shall possess technical expertise and ability to offer leadership in the field of financial sector development.
Assistance under this section shall emphasize the use of implementing partner organizations that best meet the requirements of subparagraph (C).
In order to ensure that assistance under this subpart is distributed effectively and efficiently, the office shall provide coordination and support for field-implemented programs, including through targeted core support for micro, small, and medium-sized enterprises and local financial markets.
Assistance under this section shall meet high standards of efficiency, cost-effectiveness, and sustainability, particularly by protecting the use and funding of local organizations in countries in which the Agency invests, and shall especially provide the greatest possible resources to the poor and very poor, especially women. When administering assistance under this section, the Administrator shall—
(i) take into consideration the percentage of funds a provider of assistance intends to expend on administrative costs;
(ii) take all appropriate steps to ensure that the provider of assistance keeps administrative costs as low as practicable to ensure the maximum amount of funds are used for directly assisting microfinance and microenterprise clients, for establishing sustainable microfinance and microenterprise institutions, or for advancing the microenterprise development field; and
(iii) give preference to proposals from providers of assistance that are the most technically competitive and have a reasonable allocation to overhead and administrative costs.
In carrying out sustainable poverty-focused programs under subsection (a)—
(1) 50 percent of all micro, small, and medium-sized enterprise resources shall be targeted to activities that reach the very poor; and
(2) 50 percent of all small and medium-sized enterprise resources shall be targeted to activities that reach enterprises owned, managed, and controlled by women.
(
A prior section 252 of
2019—Subsec. (a).
Subsec. (a)(1).
Subsec. (a)(2).
Subsec. (a)(3).
Subsec. (a)(4).
Subsec. (a)(5), (6).
Subsec. (b)(1).
Subsec. (b)(2)(B).
"(i)
"(ii)
Subsec. (b)(2)(C).
Subsec. (b)(3).
Subsec. (c).
In order to maximize the sustainable development impact of assistance authorized under
The requirements referred to in subsection (a) are the following:
(1) The monitoring system shall include performance goals, including goals on a gender disaggregated basis, such as improvements in employment, access to financial services, education, enterprise development, earnings and control over income, and property and land rights, for the assistance and expresses such goals in an objective and quantifiable form, to the extent feasible.
(2) The monitoring system shall incorporate Agency planning and reporting processes and indicators to measure or assess the achievement of the performance goals described in paragraph (1) and the objectives of the assistance authorized under
(3) The monitoring system provides a basis for recommendations for adjustments to the assistance to enhance the sustainability and the impact of the assistance, particularly the impact of such assistance on the very poor, particularly poor women.
(
A prior section 253 of
2019—Subsec. (b)(1).
Subsec. (b)(2).
Subsec. (b)(4).
The Administrator of the Agency, in consultation with financial intermediaries and other appropriate organizations, should have in place at least 1 method for implementing partners to use to assess poverty levels of their current incoming or prospective clients.
(
2019—
Notwithstanding any other provision of law, amounts made available for development assistance for micro, small, and medium-sized enterprises under any provision of law other than this subpart may be provided to further the purposes of this subpart. To the extent assistance described in the preceding sentence is provided in accordance with such sentence, the Administrator of the Agency shall include, as part of the report required under
(
2019—