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Displaying all posts under the topic of Commercialization
My last two posts on the potential repayment crisis in Chiapas described the high risk of a crisis in Chiapas, Mexico, and its potentially devastating consequences to the microfinance sector around the world. But here is the good news: thus far there is no crisis, and one could still be avoided.
May 21, 2013
Savings Crisis in West Bengal
In the past few weeks, the local government of West Bengal has been embroiled in a financial and political crisis that has potentially large impacts on the state’s poor and its MFIs. After discovering that the commercial entity the Saradha Group had duped thousands of investors through a real estate Ponzi scheme, the state minister launched a full investigation of over 70 other deposit-taking entities which are grouped under the category of “chit funds.”
May 17, 2013
Impact Evaluation of Compartamos Released
The long-awaited impact study of Compartamos, led by Manuela Angelucci of the University of Michigan and Dean Karlan and Johnathan Zinman of IPA, has finally been published. The research team used a randomized trial to test the impact of loans offered at 110% APR by Compartamos, the largest microlender in Mexico.
November 20, 2012
Is the Other Shoe Dropping on Microfinance Investment?
In the last week, two significant deals in the world of microfinance investment have been announced. First, Bamboo Finance announced that it was acquiring "a controlling interest" in Accion Investments, a $105 million for-profit investment fund started by Accion. In context, Bamboo Finance had $195 million of assets under management.
November 16, 2012
From Responsible Lending to Responsible Profit
If there’s one issue that’s most difficult for microfinance practitioners to explain to the lay public, it’s high interest rates. As Elisabeth Rhyne describes it, at some point the numbers get so high that people become outraged and stop listening altogether. Most recently, the issue was put back in the public eye through Hugh Sinclair’s Confessions of a Microfinance...
September 14, 2012
Managing the Difficult Trade-offs in Microfinance Regulation
A few weeks ago M-CRIL, an Indian microfinance ratings firm, published a white paper on India's evolving microfinance regulations. The overall message is that while the proposed regulatory framework is improving, it still needs work. One particular point caught my eye:
What does a microlending operation look like? Well, it may be a bank or an NGO (and many others in between), it probably has some branches, branch managers, loan officers. The funding of the MFI may come from deposits or from debt, whether from a local or foreign institution, including from online platforms such as Kiva. There may be variations on these themes, but that pretty much describes microlending as we know it.
June 20, 2011
The world’s #1 MFI is getting smaller
The last decade saw an incredible expansion of the microfinance industry, reaching 190.3 million borrowers in 2009. In 2007, in the heat of this expansion, Forbes Magazine named Bangladesh’s ASA as the top microfinance institution worldwide.
January 10, 2011
My confession, my redemption
Ten years ago, “The Microfinance Schism” was published in World Development (vol. 28, no.
November 30, 2010
Commercialization 101: What is the significance?
If you're interested in microfinance, but don't necessarily want to learn about graphs, differential equations and statistical techniques then you have come to the right place. We will regularly be posting 101 blogs that explain the core principles of microfinance. Check out our first post on Microfinance 101.
This week's blog is a basic introduction to commercialization.