92 colgan and Kolínský rates, allows MFI’s to offer financial services at fair conditions, even to the poorest.1 3 Relevance for the Stateless The alternative collateral that forms the basis for microfinance may provide a means for stateless communities to gain access to the financial sector. Exclusion from formal employment, a lack of identification, and little to no collateral means that many stateless are unable to set up a bank account or borrow funds.2 Instead, the only credit available is from informal loan sharks who are unregulated and charge extortionate rates. One time liquidity shortages can then develop into crippling long term liabilities. Moreover, without access to financial services, the stateless are restricted in their ability to invest and grow. Since microfinance does not require traditional collateral and depends on the principle of group dynamics the stateless status of a community should not, and in some instances has not, prevented stateless groups from gaining access to credit. Microfinance cannot resolve the issue of statelessness, but could serve to mitigate some of its consequences. Furthermore, weekly meetings and the election of leaders within the community could foster socialisation among the stateless communities and act as a forum for individuals to share their experiences. Microfinance empowers communities and enables them to establish their own businesses. With access to credit, individuals can adopt a long term perspective and build up their own future as small entrepreneurs rather than rely on an uncertain informal job. The empowerment and education of stateless individuals, through microfinance, would not have purely monetary benefits but could aid the entire community in their advocacy for greater rights. The feasibility of any microfinance programme depends on a number of criteria. The UN practical guide for the use of microfinance in UNHCR operations identifies the essential conditions for microfinance.3 These conditions are briefly outlined below. 1 For further information on microfinance see B Armendariz & J Morduch, ‘The Economics of Microfinance’ (2nd edn, MIT 2010) or MS Robinson ‘The Microfinance Revolution: Sustainable Finance for the Poor (World Bank 2001). 2 K Southwick & M Lynch, ‘Nationality Rights for All: A Progress Report and Global Survey on Statelessness’ (2009) Refugees International. 3 UNHCR, ‘Investing in Solutions: A Practical Guide for the Use of Microfinance in UNHCR Operations’ (UNHCR 2011) 22. tilburg law review 19 (2014) 90-97