Hope for Informal Settlements

Collective action and micro financing are two promising models for improving the livability of informal settlements, writes Neal Peirce.

2 minute read

August 14, 2007, 11:00 AM PDT

By Michael Dudley


"Most new urban slums are euphemistically called "informal settlements" - unrecognized by government, lacking basic services, and with no legal basis for land ownership. Yet they struggle upward. Take the favelas around São Paulo: From 1980 to 2000 those dwellings with piped water rose from 33 percent to 98 percent, public sewer connections 1 percent to 51 percent, electric power 65 percent to almost 100 percent.

Such advances, though, are far from automatic and especially tough to register in such deeply poor countries as those in sub-Saharan Africa and Southeast Asia. The challenge is all the tougher for slum residents living without any kind of land title or way to collateralize a loan for basic home improvements.

The best answer yet developed: collective action of slum dwellers to upgrade their own settlements and lobby the political system for neighborhood improvements. Slum Dwellers International, formed in India in 1996, has become a multination federation, active from Cambodia to South Africa. It leverages government contributions and works with grass-roots groups of residents - mainly women - who are ready to share their meager savings and strategize to gain tenure security and upgraded housing. More than 2 million slum dwellers, in 24 countries, have been mobilized.

Now it appears that the principle of micro-financing, first developed to introduce small amounts of outside capital to help individuals in poor nations start up home enterprises such as a weaving studio or a small bakery, is ready to spread dramatically to housing and such shared basic services as water and sewer connections.

Can the greater world help? The answer from the experts gathered at the Bellagio summit was a clear "yes" - that with collective grass-roots action of neighbors assuring each other's loan paybacks, there are emerging opportunities to build a series of intermediary capital institutions that can provide links all the way up to mainstream international capital markets."

Monday, August 13, 2007 in The Seattle Times

portrait of professional woman

I love the variety of courses, many practical, and all richly illustrated. They have inspired many ideas that I've applied in practice, and in my own teaching. Mary G., Urban Planner

I love the variety of courses, many practical, and all richly illustrated. They have inspired many ideas that I've applied in practice, and in my own teaching.

Mary G., Urban Planner

Get top-rated, practical training

Aerial view of single-family homes with swimming pools in San Diego, California.

San Diego to Rescind Multi-Unit ADU Rule

The city wants to close a loophole that allowed developers to build apartment buildings on single-family lots as ADUs.

March 9, 2025 - Axios

Canadian flag in foreground with blurred Canadian Parliament building in background in Ottawa, Ontario, Canada.

Has President Trump Met His Match?

Doug Ford, the no-nonsense premier of Canada's most populous province, Ontario, is taking on Trump where it hurts — making American energy more expensive.

March 11, 2025 - Toronto Star

Close-up of green ULEZ sign in London, UK.

Study: London ULEZ Rapidly Cleaning up Air Pollution

Expanding the city’s ultra low-emission zone has resulted in dramatic drops in particle emissions in inner and outer London.

March 10, 2025 - Smart Cities World

Burned car and home in Los Angeles after 2019 wildfire.

The Unseen Aftermath: Wildfires’ Lasting Health and Emotional Burden

Wildfires in Los Angeles not only pose immediate physical health risks but also lead to long-term respiratory problems and mental health struggles, underscoring the need for a coordinated public health response to mitigate their lasting effects.

March 16 - UCLA Health

View of Central Park lake with people sitting on lakeside rocks and NYC high-rises in background.

Public Parks as Climate Resilience Tools

Designed with green infrastructure, parks can mitigate flooding, reduce urban heat, and enhance climate resilience, offering cost-effective solutions to environmental challenges while benefiting communities.

March 16 - Grist

Cyclists and a red T train on the Longfellow Bridge in Boston, MA at sunset.

What the Proposed Federal Budget Means for Transit, Rail

The proposed FY 2025 budget keeps spending for public transit and passenger rail essentially the same as in 2024.

March 16 - American Public Transportation Association

Urban Design for Planners 1: Software Tools

This six-course series explores essential urban design concepts using open source software and equips planners with the tools they need to participate fully in the urban design process.

Planning for Universal Design

Learn the tools for implementing Universal Design in planning regulations.