'Although development practitioners increasingly acknowledge the positive impact of microfinance on poverty reduction, less is known about the environmental effects of microfinance schemes. Since 1999, a number of microfinance projects have been implemented in East Africa as a means to promote sustainable development and conservation. In 2007, the Worldwide Fund for Nature (WWF), LTS International and CARE International carried out an assessment of six “environmental” microfinance projects in Tanzania and Kenya focusing on two of the four microfinance models implemented in the sites, the Village Savings and Loan Association (VSLA) model and the Financial Services Association (FSA) model. The findings of the assessment have recently been published.'

Reducing peoples’ vulnerability to climate change is closely linked to the poverty reduction agenda, since poverty is both a condition and determinant of vulnerability. The paper presents views from various studies which note that the poor are already vulnerable to climate risk due to factors such as settlement on marginal lands, high dependence on climate-sensitive livelihoods, and limited access to or availability of resources to respond to shocks and stresses. Climate change will amplify, modify or introduce new types of threats, which may affect natural and human systems independently or in combination with other determinants to alter productivity of ecosystems and livelihoods. If people do not have the resources to deal with today’s stresses, then they are unlikely to be able to deal with the additional stresses associated with climate change, a condition known as the ‘adaptation deficit’ This is where, the paper suggests that microfinance can be an entry point.