Three development finance institutions (DFIs) which operate in KwaZulu-Natal (KZN) province were assessed in 1996/97 to see how they could improve financial viability and outreach to emerging farmers, agribusiness and micro-entrepreneurs. Improved service quality and emphasis on mobilising savings would help clients and enable the DFIs to diversify their portfolios. Better access to branches and lower loan approval times (improved screening and administrative procedures) could also lower client transaction costs. Charging a suitable interest rate spread is necessary but not sufficient for lenders to achieve subsidy independence. Reducing arrears through stricter loan contract enforcement (borrower accountability for loan repayment, lower collateral specific risks, secure and transferable collateral) will also promote financial viability. Providing both savings and loan services together would reduce borrower access costs, and allow savings to serve as a form of collateral and borrower information for lenders.