Why Microfinance Industry is Under Microscope

It seems the tide has turned on microfinance, and the assumption that small loans miraculously alleviate poverty is increasingly treated with skepticism. Greeks are making similar discoveries regarding large loans. I have lost track of how many frauds, collapses and...

Microfinance’s Mystical Lure All But Evaporated

Our fascination with microfinance began last century; the love affair in the mid-2000s. The United Nations declared 2005 as the year of microcredit. Muhammad Yunus and the Grameen Bank won the Nobel Peace Prize the following year. Little empirical evidence supporting...

How Some Microfinance Firms Bilk Poor Clients

A fascinating BBC news story emerged recently. A controversial payday lender called Wonga came to a voluntary settlement with the United Kingdom regulator after admitting it had been lending recklessly, at high interest rates, to people otherwise excluded from the...

Does Microfinance Industry Need a Reality Check?

I bought a five-year bond issued by the International Finance Facility for Immunisation (IFFI) in 2009. I invested £5,000 ($8,566) and received £5,810 ($9,954) a few days ago, with accumulated interest. Not the best return on capital in history, but not bad...