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  • Sinclair’s article here is full of characteristically leading and inaccurate statements, and I found it characteristically low in terms of journalistic ethical standards. It’s a tired and baseless argument from Mr. Sinclair, as described in painstaking detail here: http://nextbillion.net/blogpost.aspx?blogid=3731 This post discredits MMF’s platform and other articles posted here.

    • Hi Katie,

      As a founder of a microcredit organization and a doctoral student studying the impact of this strategy, I can say with confidence that the basis of the argument presented by Hugh is factual (that microcredit does not lift people out of poverty), and in fact well documented in the literature he cites (among other research that has been conducted). The legitimate problems with microcredit, however, are no reason to turn your back on it; in fact, it should be motivation to improve upon an idea that has the power and potential to improve people’s lives. We do that at Zawadisha through a careful approach that leverages the existing leadership in communities, works collaboratively with our members to co-create contextual solutions, and ensures that our impact is real and can be felt at the individual, household, and community level. I’d be happy to share the scholarly literature about microcredit if you’d like to dig deeper yourself — I’m sure that rather than disappoint, it will embolden you to take action. I can be reached at jen (at) zawadisha (dot) org.

  • milford bateman
    6 years ago

    Hugh, excellent posting and kudos to the Month of Microfinance for allowing you to post such a useful response to what the Month of Microfinance people must surely realise, as pretty much everyone else does now, that it is a failed intervention. How long before Month of Microfinance becomes ‘Month of Financial Inclusion’ I wonder?

    I think the one thing you missed one thing though is something on the power of ideology. Microfinance was driven forward because it was packaged up by Yunus and others as the perfect way of ‘bringing capitalism down to the poor’ as one prominent development economist put it. This was why the initial impetus was provided by USAID, the World Bank and some of the other ideologically-driven institutions. Then when a small financial elite realised they could also make tons of money from microfinance and from the poor, the sector expanded exponentially, but it created the conditions for its own demise. So you could have mentioned this for students to debate in place of the transparently false ’empowerment’ rationale put forward by far too many US-based academics. US students deserve better than being taught an elite-driven ideology under cover of ’empowering the poor’ but then so much of US economics teaching is exactly that.

    • Patrick Mfossa
      6 years ago

      Mr. Milford,
      I agree with you that microfinance is more likely to be a means of bringing capitalism to the poor to make it safe for the rich. From the post-cold war development model to these days, microfinance has gradually emerged as one of the most anti-poverty tools in SSA. This can be seen trough the so called Poverty Reduction Strategy Papers prepared with the support of IMF.
      But the gradual debunking of the claims that microfinance is a poverty reduction agent pushed those behind the machine to operate a spectacular shift towards Financial inclusion.
      Well,this isn’t in any way a surprise as Patrice Flynn (2007) pointed it out “lenders will always search for new markets. It is up to the consumer to be cautious when it comes to money” . Those behind the machine will always search for new concepts (microcredit, microfinance, financial inclusion,…) to keep the industry alive. But unfortunately, there is little the consumers can do. I am looking forward to seeing if financial education will help them become cautious!

  • Could “Katie” explain which aspects she finds so “characteristically” tired and inaccurate? If she has any evidnce of microcredit actually impacting the real world I (and the entire academic community) would be fascinated to hear her argument. Her reference to my Kiva post, which was somewhat critical in nature, is interesting. Kivans are a rare breed amongst microfinance fanatics who believe, amongst other myths, that the price of money (i.e. the interest rate) doesn’t matter. That she finds the publication of my post of sub-standard journalistic standard perhaps reflects more of her own views of freedom of speech and balanced debate in such matters. I disagree with Katie, in a number of areas, but suggesting this discredits MMF is a particular oversight of hers. The fact that MMF publishes such a range of opinions is precisely what makes it such a valuable tool in the sector. What a sad world it would be if we were all homogenous Kivans!

  • Mr Bateman, wondering about the reasons behind pushing microcredit will always be speculation. But one remarkably simple question is “what was the evidence upon which the Nobel Prize committee awarded Yunus and Grameen the Peace Prize?” Presumably they have to have some sort of evidence, and yet none has been forthcoming even all these years later. If you read the Nobel Prize anouncement (link below) it is very vague and ill-defined. It speaks in broad generalisations, about microfinance being liberating etc. They say that microcredit is one means to break out of poverty, but there is no evidence cited. Has poverty declined in Bangladesh that can credibly be attributed to microfinance? Does the Nobel Prize committee publish their justification for handing out awards?

    Again, this is speculation, but given the academics have been unable to find much evidence supporting microfinance, this only really leaves ideology and greed as possible explanations for the hype – or are there other reasons? I previously described the sector as a religious cult, and particularly after reading Murakami’s “Underground” I maintain this view. The fanatics simply cannot fathom that their beloved sector is flawed. They search for every shred of positive evidence, however flawed or anecdotal, and dismiss all criticism on whatever grounds they care to select. RCTs are fine when they appear to suggest positive impact, but when they find negative impact they are dismissed as spurious, or too short-term, or whatever. The periodic crises such as Bosnia, Nicaragua etc. are all “exceptions”, and blamed on something, anything else. The fundamental model cannot be challenged, it is written in stone, it simply does not require evidence. And many have built their careers wedded to the sector and cannot necessarily find employment elsewhere, they have school fees to pay and retirment ahead, even if they privately question the wisdom of indebting poor people, is it practical that they will jack it all in? And some of these folk are earning massive 7-digit salaries – hard to walk away from even if the evidence is not particularly supportive of the underlying activity!

    http://www.nobelprize.org/nobel_prizes/peace/laureates/2006/press.html

  • Abdoul Fatahi
    6 years ago

    Good article Mr. Patrick Mfossa. Having keenly gone through your article İ realised that besides population density and urbanisation rate a third parameter which you stated but omitted to analyse as a determinant of localition is “the rate or nature of economic activities”. MFİs’ clients should be income earners in the first place to require financial services. This cannot be related to urbanization as urbanisation is enhanced by the public administration. We will be appreciative if you could enrich us with an analysis of this 3rd factor on location.
    Furthermore İ’ll like to question on the net effect of population-density driven location and saturation of MFİ in a given geographic location. İn your text you state that a great number of these MFİs are concentrated in the bulged part of the map.

  • Patrick Mfossa
    6 years ago

    Geographic concentration of the competition between MFIs is one of those arguments put forward to explain the Over-indebtedness crisis that occurred in Nicaragua and Bosnia. Well this is the same competition that was supposed to lead to a significant reduction of interest rates charged to the customers.
    These same customers for whom only the availability of microcredit matters, not its price (according to the public narrative) .
    We were first told those customers were all genuine self-entrepreneurs who just needed access to tiny loans to grow income generating activities. There is now a great awareness that they are most likely consumption-smoothing households than capital-seeking small entrepreneurs.
    No matter who they really are, microfinance empowers them (once more time according to the public narrative). But where are the evidences to support this? Surely somewhere in the 6 recent RCTs conducted by well-respected academics.
    Well, the public narrative on microfinance is full of myths and those highlighted here are part of them. The industry is now a “four players ‘ ping – pong game ” in which the poors are the ball, those behind the myths, the players and most of us, the spectators. But i just hate watching a game where the score seems to be known in advance. Many books have been written in support to this ping – pong game, many bestsellers as well. ” Dead Aid ” of Dambisa Moyo, a high – profile Zambian economist, is one of my favorite. But if Aid is the disease of which its pretend to be the cure, then what she argues to be the solution – microfinance – seems to be even worse. Well after ” Dead Aid “, it seems at if ” Dead Microfinance : Why Microfinance is not working and how there is a better way for the poor ” will be the next best seller if the solution being proposed by its author is ” the rush towards financial inclusion ” ( the new version of our ping – pong game).

    • Patrick,

      Alas your suggested book title is taken! “What’s Wrong with Microfinance” and “Why Microfinance Doesn’t Work” were published some time ago, and I myself published “Confessions of a Microfinance Heretic – how microlending lost its way and betrayed the poor”. Anyone who bothers researching the academic evidence is generally disillusioned, and yet the game continues. So deep-rooted are these ideological beliefs that the MF supporters cannot fathom that their miracle cure is largely useless. Note that I say “largely”, however. There is a sub-set of MF clients who actually put the loans to good use. Not all MFIs are exploitative. And not all micro-enterprises are cannibalistic. While I am largely critical of the sector, where I may differ with other critics is that I think there is a small window of opportunity to use this tool wisely. But, like a medecine, the dosage is important, the price is important, the timing is important, the underlying purpose is important, and dependency is dangerous. Handing medecines out on every street corner is not a good idea. Formal regulation and transparency help to some extent, but the sector itself resists both, as un-regulated and opaque lending is more profitable for the shareholders, many of whom reside in nice offices in Europe and the US, oblivious of the suffering of the poor and enthused by the various medals and certificates they award one another. They often earn massive salaries, and convince themselves that they are doing good. Of course, we know this is largely a lie, and not only to the poor. The other forgotten loser in microfinance are the well-intentioned (but naive) donors who do wish to make a positive difference, and entrust their funds to the financial intermediaries to invest them wisely. Perhaps the true irony is that the regulators in Europe and the US permit this exploitation also, not of the poor, but of their own citizens!

      • Patrick Mfossa
        6 years ago

        Well Mr. Sinclair, i’m aware of the existence of such book. But what i argue is that since none of them did not suggest the rush towards “financial inclusion ” ( the new version of our ping – pong game) as an answer to the failure of microfinance, they are less likely to become bestsellers.

        • Fair point Patrick. So, here’s my challenge: why don’t you write it? Forgive me if I jump to the wrong conclusion, but from your surname and subject of your post on this website, is it fair to assume you are from Africa? If so, I would suggest that a book published by an African citizen would add weight to the debate – much criticism has originated from academics and consultants ultimately from Europe or the US, and can thus be criticised for being biased themselves (athough I would point out that I have lived in so-called “developing” countries since 2000, including in Africa). I cannot guarantee you will have a best-seller, but you have your first sale – I want a signed copy! Why not review the publishers that have previously published critical texts, put together a proposal, and contact them? I would be happy to help if I can, and I suspect more open-minded publishers would find a voice from Africa a refreshing change to the usual authors.

          • Patrick Mfossa
            6 years ago

            r. Sinclair, i have been thinking a lot about writing a proposal in this regards. I suggest we should discuss in box (patmfossa@yahoo.fr)

  • milford bateman
    6 years ago

    Hugh
    Yes, many people have wondered how the Nobel Committee could award the prize to Muhammad Yunus and the microcredit when there was no evidence then, and certainly since, that it was actually doing what it was supposed to. It all comes down to politics, as Patrick Bond points out here in an excellent deconstruction of the reasons why the Nobel was offered to Yunus:

    http://joh.sagepub.com/content/37/2/229.full.pdf+html

    My own thoughts on the whole saga of microcredit and why Muhammad Yunus’s thinking was completely wrong are here:

    http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2385190

  • Patrick Mfossa
    6 years ago

    Well Mr Abdoul, the type of economic activities also matters when analyzing the location dynamic of MFIs. In fact, by taking a look at the above map, one can notice that while many divisions have approximately the same population density, they do not attract the same proportion of MFIs branches. This can be explained by the fact that most of the models use by these institutions are tailored for a limited number of income generating activities.
    In Cameroun ,such activities are widely spread in the bulged part of the national triangle (precisely in the Foundi, Wouri, Fako, Mezam and Mifi divisions) and lead therefore to a geographic concentration of the competition between MFIs. While competing in a very restricted geographic zone for the same customers, these are given the possibility of contracting many loans from different MFIs simultaneously.
    Since for a given client such loans lean on the same income source, geographic concentration of the competition between these institutions may definitely leads to an over – indebtedness crisis.

  • Patrick Mfossa
    6 years ago

    The right model to adopt for an appropriate intermediation is a central question which also need to be discussed.

  • Banker To The Poor should be here too.

  • Bonsai Movie, The Vision of Muhammad Yunus, Living On One, To Catch A Dollar, Microcredit 101: The Bigger Picture and maybe Small Change, Big Business or Credit Where Credit is Due.

  • https://www.youtube.com/watch?v=WKesX9KJ-9M

    ‘Fulfilling the promise’ – film about the practical steps that MFIs can take to deliver on their good intentions. Showcases SEF in South Africa and AMK in Cambodia

  • A heart-warming story of good intentions. However, a quick glance at the financial data for Fonkoze suggests there may be some more fundamental problems, even beyond those that affect this nation.

    Fonkoze is chronically loss-making. It’s return on assets has not been positive for as long as the MixMarket has been keeping records, even after 20 years of operations. PAR 30 (the proportion of the portfolio overdue by more than 30 days) is currently 10.42%, high by any standards other than by Fonkoze’s standards (it was over 17% in 2012). The write-off ratio for 2013 was 18.02%, which MixMarket defines as the ratio of written-off loans to average portfolio. I.e. nearly one in five loans were simply written off. The institution managed to make a net loss of $816,308 in 2013. It’s operating cost ratio is 71.08%, which means it costs Fonkoze $0.71 for each $1 in outstanding loan portfolio.

    This is far from a healthy MFI. In addition, the portfolio yield is 45.82%. This is a poor proxy for the actual interest rate charged but still appears high. The actual APR is generally higher than the reported portfolio yield. What do Fonkoze investors and donors (i.e. those that stump up the net subsidy to keep this institution afloat) think of such interest rates? They hardly appear to be particularly low. And if this is having a positive impact on the lives of the clients, why are so few clients able to repay loans on time, and such a high proportion are simply written off each year?

    http://reports.mixmarket.org/mfi/fonkoze-financial-services-sa-sff
    http://reports.mixmarket.org/mfi/fonkoze

  • As an economics teacher perhaps you could comment on some very serious concerns I raised in a blog post on the well-read Next Billion website:

    http://nextbillion.net/blogpost.aspx?blogid=3726

    I would suggest Kiva is a very dangerous tool and that you may wish to research this a little more thoroughly before encouraging students to engage with such institutions. Have a think, for example, about why Kiva is unable to reproduce the interest rates on actual loans – this has far reaching implications, and is a good way to get your students thinking critically about what might appear superficially to be a nice idea, but is in fact a fairytale.

  • Nice to see an MFI on Kiva that actually states its intrest rates – 0%, albeit interest is paid in kind. Given this lack of interest expense, could the author explain why 70.99% of loans from this MFI are in default, according to the Kiva website?

    http://www.kiva.org/partners/305

    This is generally not considered a sign of success.

    • Natalie
      6 years ago

      The default rate is actually only 0.13%. The 70.99% you’re referring to is the delinquency rate, which is a result of late repayments. As the author illustrated quite nicely, many of Camfed’s borrowers are located in very remote areas so, as you can imagine, getting to the bank to make repayments isn’t an easy task. And conditions during rainy season make this that much more difficult. They haven’t defaulted, they just need a little more time.

    • Hi Hugh,
      Thanks for your question! As Natalie mentioned, the stat you site is actually the delinquency rate, not the default rate. Delinquency refers to late payments and default rate refers to non repayment and can be reevaluated on a case to case basis. As I highlighted in the article, these women face many challenges in starting a business and making timely repayments which is why the kind of flexible lending Camfed and Kiva work toward is so crucial to their success. I am happy to expand on why the delinquency rate is so high. Severe drought in some districts, and disastrous flooding in others, have seriously affected agricultural businesses, destroying crops and introducing disease. I’ve seen these impacts first hand, as maize crops are disintegrating from lack of water in some and have been swept away from floods in others. Other fledgling ventures have felt the severe impact of reduced spending power in the local community, most of which depend heavily on agriculture for their livelihoods. In some areas, like Saziso’s, teachers are the main customers. Recently, the Zimbabwean government cut teachers benefits which made Saziso lose business. As you can see there are many unpredictable conditions that women in rural areas of Zimbabwe face. It’s not that they don’t intend on paying back, its that due to these challenges it may take them a little longer than the predetermined loan schedule. These women more often than not overcome these challenges, start a business and are the sole breadwinners for their family. I consider that a sign of great success!

      If you’d like more information, Camfed recently posted a status update on the partner page addressing these very challenges: http://www.kiva.org/partners/305

      Let me know if you have any other questions!
      Tess

  • This is a fascinating article. Transparency is neccessary but insufficient. I have suggested for some years that the only way to ensure fair pricing is by formal governmental regulation, including the prudent use of interest-rate caps to prevent extortionate interest rates (as practiced in most states in the USA, for example). This article also suggests that this is one effective means to ensure transparency. Alas this is a method unlikely to receive much support from the microfinance community, whom for the most part prefer opaque interest rates which provide the principal source of profit.

    The case of Finca was interesting, and while I cannot take credit for this, it is nice to see that my mini-campaign exposing their APRs of up to 347% is no longer required. I believe Opportunity International are also addressing their interest rates, which I exposed for some time as being exortionate, thanks to the data provided by MFTransparency (see posts below).

    The final fascinating point that Mr Waterfield makes is to challenge the standard rhetoric that competition will drive down interest rates. This blind faith in the magical free market dynamic is simple nonsense, and it is refreshing to see such a learned author confirm this. Competition will only yield benefits if we permit it to. The microfinance sector generally does not, which is a key reason why we observe an utter lack of poverty alleviation as a result of microfinance.

    Finally, this article seems to suggest that voluntary codes of conduct are ineffective. There is an inherrent temptation to not participate, and investors/donors do not necessarily oblige this. Which raises yet another uncomfortable question for SMART Capaign, the sector’s best (albeit feeble) effort at self-regulation. This does not oblige full transparent publication of interest rates, and it’s definition of what constitutes a “fair” interest rate is nebulous to say the least. Smart recently awarded their certification to none other than Banco Compartamos, a by-word for exploitation, but coincidentally co-owned by the same people who own and run Smart: Accion. Indeed, Chuck Waterfield was one of the most vocal critics of the hugely profitable IPOs of Banco Compartamos, and now the sector’s own self-regulatory body has awarded the same institution its star prize!

    This is indeed a “step back” for transprency, and for the sector at large, one which I lament, and I sincerely hope that Mr Waterfield goes on to a new job where he can be equally risruptive within the sector, and promote the actual interests of the poor. There are very few people fighting for their genuine interests, and Mr Waterfield was one of them.

    One question for Mr Waterfield: you criticised Compartamos for profiteering at the expense of the poor for the benefit of a few private individuals, amongst other things while you praise Finca in this article. What do you think of Finca paying their CEO, Rupert Scofield, over $700.000 according to page 13 of the 2013 990 Form (see link below)? You have alluded to interest rates and profitbility crossing a red line and become excessive, does the same apply for salaries? Note that Scofields earns more than even the CEO of Accion!

    http://blog.microfinancetransparency.com/an-opportunity-for-the-poor/
    http://blog.microfinancetransparency.com/exploitation-declines-a-bit/
    http://990s.foundationcenter.org/990_pdf_archive/133/133240109/133240109_201312_990.pdf?_ga=1.185135200.817836399.1427141764

  • Living on One Dollar, Bonsai Movie, and To Catch a Dollar

  • Gordon Crann
    6 years ago

    Thanks, Bob, for a well-written and balanced blog on a very topical issue these days. I agree with your conclusion. I have urged the Rotarian Action Group for Microfinance and Community Development (RAGM) to bring your blog to Rotarians around the world who are interested in microfinance.

  • Helen Samett
    5 years ago

    Congratulations Sam for all you have done and continue to do to help end world-wide poverty! You are indeed “one of the certified great social entrepreneurs of the last decades.” I am so proud to have been a partner in RESULTS since its inception and to have worked with you in bringing awareness to the world about this problem. I have been privileged to hear Prof. Yunus speak and tell his stories many times, and most of all, I am so proud to have arranged a meeting for Prof. Yunus to meet with George Soros years ago when I was working for Lockheed Martin. If I recall, Mr, Soros was so impressed with Prof. Yunus that he contributed $10M to his Foundation. RESULTS has come a long way, and now at age 95, I look back with pride at all the successes RESULTS volunteers have accomplished, and remember all the wonderful conferences I attended with them in D.C. Keep the fires burning, Sam, you are my hero!

  • Fabulous stories. Sam is expert at reminding all of us about the difference microfinance makes in the lives of real people. thanks Sam.

  • I really appreciate what Chris unpacks in this article. His comment: “Development services to support food security, income generation, child education, and health improvements all requiring behavior change ‘for their own good’– were usually greeted by the poor with depressing lack of enthusiasm, much less gratitude” really speaks to the issues at hand. We (Westerners) have a long history of telling people what they should do and how to do it. While we see it as “for their own good,” it actually is an incredibly demeaning approach to working with other adults, robbing them of their pride. When we shift the focus of microfinance from providing loans for microenterprises to providing the capital for people to procure assets and increase their resiliency to shock, we are sending a strong message that we believe that our clients have the integrity and capability to make the best decisions for themselves. It is a more respectful, just approach, even if it doesn’t fit within the narrative that has been built around microcredit.

    Side now: Just as I would never allow a credit card company or bank to tell me how to use my credit or live my life, we too should expect that the recipients of small loans also have the same power over their own lives. Perhaps this is why platforms such as M-Shwari in Kenya are so popular — people receive credit without having to jump through development hoops.

  • Aron Rosenthal
    5 years ago

    Unfortunately this is yet another example of how the industry should spin its branding and messaging as it simultaneously ignores the political and historical reasons for poverty in countries where one often finds a flourishing MFI sector. There is no mention of structural readjustment policies, neoliberal trade failures nor a brief historical overview of land dispossesion. But don’t fret, MFIs will lend you money at 40% APR because the state just stripped you of your safety net in order to qualify for an IMF loan and you can’t afford you hospital bill. And what about poor people taking out loans to pay back other lenders? It’s one giant microlending ponzi scheme. The author at least has the courage to admit it is clearly NOT reducing poverty like so many MFI websites would have us believe and a paltry 25% actually use their credit to invest in a microenterprise. Poor people have been cheated, exploited and robbed and are owed money. But nobody seems to want to mention reparations. For one it would prevent people like the author from making six figures a year.

  • Three good questions. To sharpen the first one (and I leave all my other nags about Kiva aside): where this article and the Devex article talk about “zero percent interest”, I wonder does that mean the new instrument actually disburses loans to borrowers in Africa/Asia/LatAm at zero percent ?

    Or does will it lend to MFIs at zero percent, which then on-lend at whatever interest rate they choose (usually somewhere between 20 and 100 APR – http://blog.microfinancetransparency.com/whats-wrong-with-kivas-portfolio-yield-statistic/)?

    If the latter is the case (as per Kiva’s standard model), then I fear Kiva is still deliberately treading the rather fine line between (unintended?) confusion and outright deception of its well-meaning lenders, for which it has been criticised since 2009 (recall: http://www.nytimes.com/2009/11/09/business/global/09kiva.html?_r=0). Perhaps P. Shah would like to briefly clarify here.

  • My thoughts too lol..

  • Arman Tahaboor
    5 years ago

    Great job done Ms Dilshad and the rest of the team at BRAC! Best wishes! 😀

  • My vote definitely goes to #5 Due Diligence but I would warn folks that it’s better for someone who wants to get in the weeds. Banker to the Poor, recommended by Molly, is a great first introductory book written by Yunus who is probably the most publicly recognizable figure from microfinance. My last plug would be for #1 Portfolios of the Poor which helps give a much more nuanced picture of how poor borrowers making rational decisions could take loans from both microfinance institutions and moneylenders depending on their needs at the time.

  • Estimados

    Efectivamente, poco se hace por incluir a la población rural, lugar donde existe la mayor cantidad de pobreza 45% en Perú. Les comparto una experiencia exitosa que me toco desarrollar. La tecnología y la transformación digital a evolucionada la forma de hacer microfinanzas inclusivas en las zonas mas pobres del pais.

    a) http://www.cioal.com/2016/08/04/garibay-transformacion-digital-comienza-cio/

    b) http://cioperu.pe/articulo/21450/el-uso-de-la-tecnologia-para-el-cliente-rural/

    Con Aprecio

    Ing. Jose Garibay
    Perú

  • Dr. V. Rengarajan
    4 years ago

    Is the term “Microfinance” a deceptive one?

    Does the term ”Micro finance” mislead the industry in their social mission value chains? The past two and a half decades of foray of Micro credit, camouflaged as Microfinance in poverty arena, witnessed a dramatic digital inclusion, digital transfer and digitally demonstrated eradication of poverty in digital devices only followed by Institutional trajectory (NGO-MFI-NBFC-Small Bank ) in the supply side. On the other hand, remains unacceptable level of poverty and inequity manifested in economic deprivation and social vulnerability transparent globally. Is this sordid situation ‘because of’ or ‘in spite of’ the above digital revolution in the supply side of Microfinance industry ,dominated by unethical money lending activities in the name of Micro finance . ( not to mention borrowers’ suicides as in the case of India),
    In this context, due diligence is required to prudently institute ‘denovo’ a term “Poverty finance” ( instead of Micro finance ) integrated with poverty cure package of financial and non financial inputs tailoring to the needs of poor in different layers in the pyramid on the lines of CGAP-BRAC graduation model. From the demand side perspectives, the term for target group ‘THE POOR” which is more generic , need to be replaced with the specific focus on ‘The poorest “ found in bottom pyramid. How to take advantage of digital means for ensuring candid poverty cure in reality in the last mile rather than making a tall claim digitally anecdoted concealed with non transparent digital divide, in the board rooms? – Dr. V. Rengarajan

  • Dr.V.Rengarajan
    4 years ago

    Does the term ”Micro finance” mislead the industry in their social mission value chains? The past two and a half decades of foray of Micro credit, camouflaged as Microfinance in poverty arena, witnessed a dramatic digital inclusion, digital transfer and digitally demonstrated eradication of poverty in digital devices only followed by Institutional trajectory (NGO-MFI-NBFC-Small Bank ) in the supply side. On the other hand, remains unacceptable level of poverty and inequity manifested in economic deprivation and social vulnerability transparent globally. Is this sordid situation ‘because of’ or ‘in spite of’ the above digital revolution in the supply side of Microfinance industry ,dominated by unethical money lending activities in the name of Micro finance . ( not to mention borrowers’ suicides as in the case of India),
    In this context, due diligence is required to prudently institute ‘denovo’ a term “Poverty finance” ( instead of Micro finance ) integrated with poverty cure package of financial and non financial inputs tailoring to the needs of poor in different layers in the pyramid on the lines of CGAP-BRAC graduation model. From the demand side perspectives, the term for target group ‘THE POOR” which is more generic , need to be replaced with the specific focus on ‘The poorest “ found in bottom pyramid. How to take advantage of digital means for ensuring candid poverty cure in reality in the last mile rather than making a tall claim digitally anecdoted concealed with non transparent digital divide, in the board rooms ?

  • Really Magreth is doing a great job.Women can do something they only need support. They are a great nation and Magreth is a good example to other women in the world.Brave Magreth

  • How many members does TSCU have today (June 2017)? Thanks.

  • Elena Savas
    3 years ago

    Hi I’m Elena Savas and I am a junior at the prep school of Hopkins in New Haven, CT. I’m looking to start a microfinance club using kiva and would like to connect with someone who has experience and knowledge that they will be willing to share with me.

    Thanks I look forward to hearing from you,
    Elena Savas

    • Andrew Tong
      3 years ago

      Hi Elena,

      David has graduated St. John’s but the Maverick microfinance club is still going strong! I can help with Kiva and I can connect you with our current president. Please reach me at atong20@sjs.org

      Andrew Tong

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