“A lot of money was invested in the microfinance sector before really thorough research had gone into its effect on the poor,” he said. “Even though microfinance has been going for over two decades now, it’s actually only in the past two or three years that academically respectable, large-scale studies have been done.”…
In addition, the industry still projects their mission as one of poverty eradication even though it’s really about financial inclusion….
“If they’d [MFIs] been a bit more on point – ‘We’re not the solution to global poverty. We’re not ending it’ – then they would have been much less vulnerable,” he said. “The world would have been much less surprised to find out that sometimes financial inclusion does go wrong.”
Quotes from Leo Hornak, who worked in the Indian microfinance industry and now covers the sector at BBC.
These words echo my thoughts on the topic, as readers of this blog know.
Full article at Beyond Profit, which after a brief intro is basically a long interview with Leo Hornak.