In 1975, when the U.N. Decade for Women was declared at an international conference in Mexico, Michaela Walsh said she heard many Third World women complaining about their "lack of access to the modern economy."

"Hearing that changed my whole life," said Walsh, who had spent 20 years working in investment and finance for Merrill Lynch & Co. and Rockefeller Brothers Fund.

She decided to help businesswomen "make the move into the formal economy" and in 1979 set up Women's World Banking, a nonprofit organization that extends credit to businesswomen.

Now attending the final sessions at the U.N. Women's Decade Conference in Nairobi, Kenya, Walsh reports that some progress for women has been made during the decade.

The conference has been bogged down by political fighting and controversial resolutions against apartheid and terrorism, but Women's World Banking can report concrete accomplishments.

So far, the organization has worked with 20 banks around the world and provided 1,000 loans to women with small businesses, mostly from developing countries. Not one default has occurred, Walsh said in a telephone interview before leaving for Africa.

She said women's need and demand for credit is tremendous. Lack of collateral and lack of access to information block women from starting businesses at a time when more and more women say they want and need to work.

The only credit option for many women in developing countries is to go to a moneylender, who typically charges 10 percent interest a month and up to 150 percent a year, Walsh said.

Incorporated in the Netherlands and based in New York, the bank has 41 affiliates around the world that are working to obtain loans for women at market interest rates. The bank also provides women entrepreneurs with financial advice.

So far, Women's World Banking has guaranteed loans ranging from $500 to $200,000. Hundreds of women's small businesses have been started or expanded, including a rural cooperative in Kenya, a textile shop in the Dominican Republic and a national dairy farming project in Thailand.

Women's World Banking gives local banks some incentive to lend women money by arranging a guarantee of 75 percent of the loan.

The process works like this: First, a group of people, usually women, establish a local affiliate of Women's World Banking. The affiliate raises money for its guarantee fund and finds a bank willing to work with it. It also screens applicants for loans and provides them with financial counseling and assistance in filling out loan papers.

If the local bank approves a loan, the affiliate assumes 25 percent of the risk, the lending institution assumes 25 percent and the central headquarters of Women's World Banking guarantees 50 percent.

Women's World banking guarantees loans with its capital fund of $3 million, raised through grants from governments, foundations, individuals and international organizations.

The organization's original goal was to establish a capital fund of $15 million, but so far it has raised only $3 million.

The Agency for International Development, one contributor to the capital fund, recently issued a report stating that in many countries, women are denied the right to hold property in their own names, "making women's independent access to formal credit sources impossible."

Development programs often fail to provide women with information about credit and tend to orient their assistance programs toward men, said the AID report.

The International Labor Office reports that women now make up 35 percent of the worldwide labor force, up from 31 percent in 1950.

While the number of working women has grown to 675 million, women tend to be concentrated in low-paying, low-skill jobs, according to the United Nations' 1985 State of the World's Women report.

Faced with unemployment or low pay, increasing numbers of women have turned to self-generated employment in the informal sector.

Margaret Lycette, of the International Center for Research on Women, estimated in a report that in most developing countries 40 to 60 percent of the informal sector labor force in urban areas are women. In African countries, more than 80 percent of the total female labor force works in the informal sector, she reported.

While most of Women's World Banking's activity has been in developing countries, the first and only branch in the United States was established in Charleston, W.Va., in March.

"We're somewhat similar to Third World countries here in West Virginia," said Chris Weiss, chairwoman of the affiliate's board. "This is a largely rural state with a high rate of poverty among women."

In West Virginia, where unemployment was 9.6 percent in June, many women are eager to start their own businesses, said Weiss. She and other Women's World Banking board members already have identified 10 to 15 potential entrepreneurs and expect the bank they work with to approve the first loan within a week.

"It's really exciting to try to get credit for women, and to see it happening internationally," said Weiss, who just returned from the women's conference in Nairobi.