Financial services and environmental health : household credit for water and sanitation

Policymakers and program designers in nongovernmental organizations (NGOs) and international financing institutions also may find much that is relevant to their attempts to incorporate microfinance within the design of a wide range of activities. The paper addresses the following questions: (1) Is a credit approach superior to grants for supporting on-site per-urban water supply and sanitation (WS&S)? (2) What lessons learned from microfinance can be incorporated in the design of credit programs oriented toward WS&S and general housing improvement? (3) If credit is a better financing mechanism than grants, should it be narrowly channeled to finance particular types of investment, or supplied in the form of a more flexible housing improvement loan? (4) What types of institutions are best suited to supply household credit to support WS&S initiatives in poor urban and peri-urban areas? (Author abstract)